This is an open invitation to everyone in Cayman who feels their questions have not been answered. Ask me now. Ask me by posting on Facebook at Caymanians 2025; send me your questions on twitter at caymanians2025, or simply email me at contact@caymanians2025.com I will answer your questions through the app, through the social media and through a video podcast you will find on the YouTube channel, Caymanians 2025.

Inevitably, at this time, most of the questions being asked focus on the debate about whether Cayman should move forward with building the cruise berthing and enhanced cargo facilities. I hope that as time goes on, we can move on to other important issues that will guide our future. In the meantime, I hope you will agree with me that the referendum is not a matter to take lightly. It’s our opportunity to take control over what happens to us today and tomorrow. I don’t want any of us to feel we were not prepared to make this decision. Please use the mobile app, use the email, reach out through the social media and get the information you need.

I have framed this being about Cayman in 2025. Why 2025? – this is the timeframe that will see the work or plans started under the two administrations that I have led being fully completed and benefiting Caymanians.

This includes:

 Fully modernised Airport Infrastructure; Major roadworks, including a new public transport system; A vibrant and revitalised George Town; Mental Health facility; Improved Schools infrastructure; Modern and improved education and health systems; A modern waste management system that includes a waste to energy plant; The current landfill capped and remediated; And provided the Yes vote wins the referendum, then a cruise and enhanced cargo facility

All of us need to take responsibility for the quality of life we will have in 2025 through to the next generation in 2050. As responsible decision-makers, we can chart a positive and ambitious future for our country based on sound plans for sustainable economic growth. Or we can ignore reality and believe that we can let the status quo remain, hoping for the best.Therefore, the debate we are having is about more than a port – it is about deciding the direction that our Islands will take on December 19th that will impact upon our next generation. The debate is about whether we want to remain in the cruise tourism business in a major way or are willing to allow this business to diminish over time.The impact of this decision has a knock-on effect on other things, such as government’s finances; entrepreneurial and employment opportunities for Caymanians; maintaining a good standard of living; and yes also whether the reefs around George Town Harbour are in a better or worse condition by 2050 than they are today.

So while the question on the ballot paper in this referendum might be about cruise berthing and enhanced cargo facilities, the question for the country really is whether we still have the confidence in ourselves and in our future to grasp the opportunities before us - the opportunities to start new businesses; the opportunities to improve our world-class cruise tourism product; the opportunity to greatly improve our cargo port; and, yes, the opportunity to show we can deliver a world-leading coral relocation and regeneration programme.

I believe in a strong and prosperous future for Cayman. I believe in opening the door to economic opportunity - not slamming the door on the jobs of the hundreds of Caymanians whose livelihoods depend on cruise visitors. Finally, I believe that the majority of Caymanians believe as I do. The referendum gives them the chance to show their confidence in themselves and in a prosperous future.

The choice facing the people of the Cayman Islands on 19th December is a clear one. We can choose to move forward with building our new cruise berthing and enhanced cargo port facilities. If we do so, we guarantee that cruise ships will continue to bring their visitors to Grand Cayman and in so doing we safeguard existing jobs and create more employment and business opportunities for Caymanians as well as protecting Government revenue.

The enhanced cargo facility will mean that the port can handle bigger ships, and more cargo, more efficiently and this helps drive down the costs of all the goods we import. This redevelopment of our tired and inefficient cargo port can only be funded because it is being linked with our new cruise berths. Cayman can choose to move forward with building our new cruise berthing and enhanced cargo port facilities. We can and we should choose prosperity.

On the other hand, we could choose decline. We could turn our backs on the redevelopment of our port. As cruise ships grow in size, they will increasingly pass by Cayman on their way to other destinations that have the facilities needed to cope with their passengers. Visitor numbers in Cayman will fall. Caymanians will lose their jobs and their businesses will fail. We could try to make do with cargo facilities that are already too small to meet our current needs, let alone meet the needs of a growing population. But there will be a cost to pay.

We must all, including those opponents who are planning to seek national leadership, accept the responsibility that our decisions will have on the delivery of sustainable living for all Caymanians. All Caymanians must be responsible and participate in the process of making and implementing the right strategic decisions for the well-being of our family, community and country.

All Caymanians by 2025 and beyond must work towards:

Growing the National Economic Pie and Receiving a Larger Economic Share for All Caymanians through:

-Better Paying Jobs-Support for Caymanian Entrepreneurs to be successful-Improving the quality of Government Public Goods and Services-Strong Health Care, Education, Social Services- A safe society with low crime or the fear of crime

We must also be responsible and compassionate. As Caymanians we love and care for our families, caring for our communities and yes loving and being proud of our country.

I believe in Caymanians. I came into politics because I wanted to help shape the future of our Islands. I still do. The launch of the Caymanians 2025 initiative gives you the opportunity to take part in the debate about what the future might be for the benefit of the next generation of Caymanians. Please join me as we chart Cayman’s future course.

Nov 08, 2019

2020/2021 Budget Statement

Nov 08, 2019

2020/2021 Budget Statement

Alongside the Throne Speech, the debate on the Government’s Budget Policy Statement and the Appropriations Bill that the Minister of Finance will speak to later offers the House the opportunity to debate the Government’s proposed budget and policy approach for the period from I January, 2020, to 31 December, 2021. As is usual, there is a vast amount of detailed information to get through during the debate and the relevant documentation is now before Honourable Members.

At more than US$2B this is the biggest budget in the history of the Cayman Islands spanning the two-year budget cycle.

Mr. Speaker, the 8th of November seems a fortuitous date for me to rise to deliver my final Budget Policy Statement as Premier. For it was nineteen years ago this very day that I was first elected to this House.

Mr. Speaker, all of us in this House will likely recall how easy it is in the aftermath of an election campaign to get caught up in the thrill of victory even while acknowledging those amongst us who are dealing with the agony of defeat. That heady feeling of victory after a tough political campaign is something you don’t easily forget. I remember well such a moment nineteen years ago when I was celebrating with my mentor and running mate, the Hon. D. Kurt Tibbetts who had also won his seat again. Those of you who have had the privilege of working alongside Kurt Tibbetts will remember the lessons that he taught us all about being a representative of the people. And so, Mr. Speaker, as Kurt and I celebrated, a young man sheepishly approached us and said good night to his not yet sworn in George Town representatives, and started to speak with us about his situation and concerns.

Mr. Speaker, after all these years I still remember the smile that crossed Kurt’s face when he said to the young man – “my colleague Mr. McLaughlin will advise you”. And he turned to me and said, “MLA Alden McLaughlin, your work begins tonight”. Then he patted me on the back and left me listening to my young constituent. I was not yet sworn in and though my celebrating was short-lived, the start of the work I would carry forward for the next nineteen years had indeed begun.

I also recall my feelings when I subsequently entered this Chamber for the first time as the Second Elected Member for George Town. I confess to feeling a little pride in my joining this esteemed body of legislators, Mr. Speaker. But I was also humbled by the faith shown in me by the 2,057 electors who had cast their ballots for me.

Above all, what I felt was a determination to do my best to deliver real improvements in the quality of life, not just of those 2,057 who voted for me, but for all the people of the district of George Town and these Islands more generally. I have no idea whether the young man who spoke with me on election night voted for me or not – it did not matter, I was his representative.

That determination remains, Mr. Speaker. In the last nineteen years, I have had the privilege to serve our people in a number of different capacities, including as Leader of the Opposition. But the most fulfilling and challenging political role has been the last six and a half years as Premier. But I often joke that if you can do this job you can do anything. It has required me to stride an international stage: appearing on BBC’s HARDtalk television interview programme and providing a keynote speech at Chatham House; negotiating with the EU over financial services issues; engaging partners in CARICOM to win their support for our stand in defence of our Financial Services Industry; negotiating with the UK government to press the case for Cayman to be able to chart its own economic and political future; and even recently leading a government and private sector delegation to Monaco to further encourage trade and business links between Cayman and the Principality.

I can honestly say, Mr. Speaker, that nineteen years ago I did not envisage myself doing any of those things. But I have been willing to undertake those tasks and more because they are necessary things for a Premier to do.

In promoting the Cayman Islands we need to be prepared to take our case to wherever we need to go. As Cayman becomes more confident in itself and develops more capability to promote these Islands and our interests overseas then I suspect that whoever follows me as Premier will need to be willing to engage in even more of that kind of activity.

Wherever the role has taken me, however, and whatever the task at hand, I have always, at heart, been a community politician. I understand the need for an international perspective but I have always retained a focus on our community at home.

You see Mr. Speaker, I understand the need to engage foreign governments and foreign leaders but I have always recognized that as politicians and representatives we must engage our own people.

I also understand the need for government to have vision and to build a prosperous future - but I have always also understood that jam tomorrow is of no use for folks who have no bread today.

It is not though, Mr. Speaker, a choice between the need to address present concerns and the need to plan for the future. Government cannot ignore the need to take a longer-term, internationalist perspective any more than it can ignore the immediate needs of our people. We have to do both of those things – this has been my approach since becoming Premier in 2013.

So that, Mr. Speaker, is the underlying theme of the budget that this unity Government is bringing to the House today. It is about continuing to build a strong Cayman by meeting today’s needs and building for tomorrow.

In putting this budget together we have also had one other goal in mind - and that is to finish what we have started. This unity Government set out on an ambitious programme for the country, building on the platform created by the previous Progressives-led Administration. We are determined to deliver on the commitments we gave and this budget ensures that the resources are there to complete the key projects that make up our ambitious programme.

Setting out to deliver a programme is a key task for any government, Mr. Speaker, but no government can foresee what will happen over the course of a four-year term. So a wise government does not just stick to its plans. It is prepared to respond as circumstances change. That, Mr. Speaker, is leadership and that is the leadership that I and the Governments that I have led these past six and a half years have shown.

This is a Government prepared to respond. Each budget process gives us the opportunity to prioritise scarce resources to meet the changing needs of our people and so we have done that, Mr. Speaker.

As the Member for Prospect so eloquently reminded the House only last week, the immediate priority for many people in our communities, certainly in the south and east of Grand Cayman, is traffic. Members who represent those communities probably receive as many complaints as I do about the need for road improvements and I am sure that they will be pleased to see the actions being taken for which money is being appropriated in this budget.

The Government has not, though, waited for the budget before taking action. We have been able to get work under way now that will be completed in the months ahead utilizing the new resources from the budget before the House today. Honourable Members will be aware of what is already being done to increase capacity and to smooth traffic flow at critical junctions. I was very pleased last month to be able to visit the works now under way in Red Bay and Prospect with the Minister for Infrastructure and I would like to thank him for the positive and proactive way he and the NRA under new chairmanship have responded to the problems being experienced. Of course, I am now getting complaints about the roadworks but I guess that is inevitable.

What I can reassure commuters is that the roadworks now under way will make a significant difference to traffic as it moves from the east towards town in the morning peak and back again in the evening. The work on the expansion to the Red Bay Roundabout to increase it to three lanes began last month and should be completed by Christmas and is the first vital junction improvement in the chain.

The NRA has also begun work to create the necessary third lane at the Grand Harbour Roundabout. Initially this extra capacity will be utilized as a filter lane for traffic entering the roundabout from South Sound Road. However, as other improvements come on-stream, the extra lane will facilitate better traffic flow in both directions between the CUC Roundabout at King’s Sports Centre and the Chrissie Tomlinson Roundabout. That roundabout will be upgraded alongside the addition of two new lanes at Rex Crighton Boulevard between the Poindexter Roundabout and the Chrissie Tomlinson Roundabout.

These and associated improvements such as the new layout of Shamrock Road will add much-needed capacity, which will reduce congestion and delays and improve commuting times. While these benefits will be felt by drivers in the early part of next year, I am afraid the relief will be short-lived unless more is done.

The reality is that Cayman’s economic growth is continuing to increase our population and relative prosperity is compounding that with increased car ownership. As I signaled in my Strategic Policy Statement address back in April, the budget reflects this Government’s determination to act. Mr. Speaker, we have brought forward planned improvements in the Island’s strategic road network to give a significant increase in capacity from the eastern districts through to join up with the improvements currently under way and on into George Town. The planned extension of the East-West Arterial Road, first to Northward and then through to Look Out in Bodden Town, has been brought forward into this budget period rather than being left until the next as had originally been planned. This means we can deliver the most significant increase in the capacity of the road network east of George Town in at least a decade.

Mr. Speaker, I hope that you will forgive me for speaking at such length about issues that have little to do with West Bay. However, I am sure that every Member in this House will have heard their constituents voicing concerns about the cost of living. The good residents of West Bay no doubt will be as interested as others across these Islands to hear how the Government plans to respond to those particular concerns.

The Minister of Finance has explained before that there is little that the Government can do in a systematic way to address the cost of living. We lack the usual instruments of monetary policy that other governments rely upon in these circumstances. Moreover, our almost total reliance on imports means that we can never be isolated from economic conditions elsewhere; especially in the United States but also in global markets more generally.

If we lack the tools for an economy-wide response, then government must look instead for a more targeted approach.

The biggest single factor by far impacting the cost of living in the Cayman Islands now is housing. We have all seen, Mr. Speaker, the clear indications of both the increasing cost of homeownership and the escalating costs of rents that are directly impacting Caymanians and residents. While the property market and the rental market are linked, there are also different dynamics at play within each.

Home ownership is a dream to which all Caymanians aspire, and justifiably so Mr. Speaker. This Government believes that if you work hard and save responsibly then it should not be a dream beyond your reach. And yet that is the position in which many young Caymanian families find themselves. Such is the strength of the property market in our Islands that those Caymanians with property are able to sell at an exceptionally good price. However, Caymanians seeking to buy can find themselves effectively priced out of that market.

We are not a ‘do nothing’ Government that is willing to shrug our shoulders and say ‘well that is how markets work’. No Mr. Speaker, such an approach is not acceptable to this Government – which is why we have supported the work of the National Housing Development Trust in building affordable homes as well as reduced stamp duty for first time Caymanian homebuyers.

In the coming budget period, we have put in place a number of measures that will help further bring home-ownership within the reach of more young Caymanian families.

First, Mr. Speaker, the budget provides for the full effect of the stamp duty concession we have put in place for first time Caymanian buyers. This allows homes up to $400,000 to be purchased by first time Caymanian homeowners stamp duty free. That concession makes a significant difference to the amount of cash needed when making a purchase and has the knock-on effect of making the necessary deposit easier for young Caymanians to put together. Mr. Speaker, based on 7.5% stamp duty, this amounts to a savings of $30,000 for a $400,000 property. This policy change is already proving effective and many Caymanian families have already benefitted from it.

In this budget we are extending this provision so that for all Caymanians wishing to purchase a first home, the first $400,000 will be duty-free regardless of the value of the home. This extends the duty reduction across the full range of likely first-time buyer properties in Cayman. It brings the benefit to more Caymanian first time buyers as the $30,000 saving will now apply to all properties. Legislation will be needed to effect this change and we will bring that forward to the House as quickly as possible so as not to create any problems in the market pending the change. We will keep the duty free threshold under review and we are willing to consider further concessions in favour of aspiring and hard-working Caymanians if we deem necessary.

Secondly, we will reinvigorate other programmes that support Caymanians wanting to own their own home. In past years over 300 families have been assisted by the Government Guaranteed Home Assisted Mortgage programme, or GGHAM for short. This programme, run in conjunction with participating local banks, provides the lending institution with a government guarantee of up to 35% of the mortgage amount. This covers the required down payment as well as provides some additional risk protection for the bank. Historically this programme has been very successful with negligible levels of default.

We shall also look again at the ‘Build on Your Own Property Programme’ to help those individuals who own their land but need some help qualifying for a mortgage.

Thirdly, we are continuing to support the work of the National Housing Development Trust. I have said in this Chamber before, Mr. Speaker, that the Trust has been re-invigorated under this Government. New build projects have been delivered in Bodden Town and East End. Currently, there are schemes awaiting planning permission to deliver more affordable units in both East End and West Bay. These affordable homes built by the Trust represent an important route to home-ownership for Caymanian families and I look forward to the Trust bringing to fruition their plans for the 24-acre site they have acquired in George Town. This budget continues the Government’s funding commitment in terms of meeting the ongoing financing costs of the Trust’s work.

But we cannot simply rely on the good work of the Trust to meet a growing need among Caymanians while developers build more and more housing units aimed exclusively at the luxury end of the market. To be fair, there is an economic logic compelling developers to act in this way so Government will work with them to look, for example, at how we might encourage them to deliver more affordable homes for Caymanians.

Rents are an issue across the economy but there are particular issues impacting the lower end of the market including for families seeking housing assistance through the Needs Assessment Unit. We need to work with potential landlords to look at ways government might approach the market differently in order to encourage more supply.

Government will also commence discussions with the Housing Development Trust about the possibility of renovating or redeveloping some existing government-owned properties and bringing them back to the rental market.

While housing costs are the most significant factor impacting the cost of living, there are of course other issues at play. Prices of imported goods are also an issue and that does allow me once again to draw the straight-line, and obvious link, to the importance of the proposed cargo port enhancements. Greater volumes, new routes and more efficient operations will reduce the costs of imports. Period. Relying on the current inefficient operation as we continue to grow, not only drives up cost but increasingly becomes untenable.

Certainly the people in the community I represent still tell me that they believe the cost of gas at the pumps in Cayman is unreasonably high. I am delighted, Mr. Speaker, that at long last OfReg has now appointed consultants to look at the operation of the fuel market in Cayman. While all my instincts believe in markets, Mr. Speaker, if that review finds that the fuel market here is not operating fairly in the interests of Caymanians and residents then there will have to be change. If fuel supply companies are not willing to respond positively then, as I have said before, the government will intervene if necessary.

As well as particular categories of cost, we also need to look at the question of whether the relatively high cost of living is having a disproportionately greater impact on some parts of the community. Here, the evidence suggests that in Cayman, costs are having the greatest impact on older persons, particularly those with fixed incomes that do not increase as their household bills go up.

The budget before the House addresses that issue and the Government is announcing today a package of concessions designed to reduce the costs falling on older persons. Across government, some 14 fees or duties will be significantly reduced or waived for persons over 65. The package includes reductions in vehicle licensing fees, duty reductions for mobility scooters and wheelchairs and reduced post office box rental fees. My own Ministry will reduce work permit fees for caregivers of older persons and we will reduce import duties for older persons coming through the airport. The impact of the changes will obviously vary from individual to individual but the concessions generally focus on those in greatest need. We calculate that the revenue foregone by government will total approximately $830,000.

Prices are only one side of the cost of living equation, Mr. Speaker. The other, of course, is income. Here, government does have some more direct tools at its disposal. Again, we are taking action and once more the focus is on providing support for those in the greatest need. The first budget announced by this Unity Government increased the guaranteed minimum income payment for seafarers, veterans, those in need of social assistance and long serving civil service pensioners to $750 per month from its previous level of just $550.

I am delighted to announce today, Mr. Speaker, that this budget has again provided for more support for these groups of people and that from the 1st of January, 2020, they will see their monthly income rise by another $100 per month to $850. We will go further, Mr. Speaker, and the budget provides for a further $100 per month from January 2021, lifting the monthly payment to $950. This means that under this Government, there will have been an increase of at least 73% in the income of over 2,000 of Cayman’s most vulnerable and hard-pressed households.

This government pledged to support the most vulnerable in our communities. We are delivering on that promise. I would like to thank the Member for Prospect who is also my Councillor for Community Affairs for the excellent work he does for the Ministry. Carrying three Ministries plus the role of Premier I simply could not do it without his assistance.

The flexibility of Cayman’s labour market means that wage levels tend to lag behind growth and productivity. This, of course, was one of the major reasons why my previous Administration introduced the country’s first national minimum wage. The minimum wage is now under review. Before I get howls of protest from business leaders, I well recall the controversy that accompanied the original decision to introduce the minimum wage. And yet, growth has continued and thousands of jobs for Caymanians have been created. Therefore, Mr. Speaker, I hope the experts leading the review will look at the opportunity for an increase in real terms in the national minimum wage.

In the meantime, government will continue to do its part. Mr. Speaker, during my delivery of the Strategic Policy Statement earlier this year I indicated then that we had mostly corrected the wage concerns of civil servants, in particular with regard to wage stagnation and income lost during recession-related austerity measures. But I also referred then to the higher prices in the shops. In the run up to the SPS and in the months since I have had several conversations with the Deputy Governor regarding civil service wages.

Another announcement I am therefore making today is that in putting together this budget, the Government has allowed for a 5% cost of living increase for civil servants with effect from 1st January, 2020. The government believes that the hard work and dedication to public service shown by civil servants should not be taken for granted and we are providing for this increase in recognition of the contribution civil servants make every day to the well-being of this country and its people. We all, on these benches, appreciate and value their service and the sacrifices many of them make every day.

This increase also has an influence on the wider labour market. It acts as a signal to private sector employers and as a stimulus to wage growth elsewhere in the economy. Wage increases for public service employees, however desirable, are only appropriate if they are affordable to the public purse. The pay rise I am announcing today will be offset by efficiencies and other savings made elsewhere in the budget. In that way, we intend that the cost of living increase we are announcing should be self-financing. I am very grateful to the Deputy Governor and his Chief Officer team for the positive approach they have taken in committing to find the measures necessary to fund the pay increase.

It is striking, Mr. Speaker, that both of the issues I have mentioned so far today – traffic problems and the cost of living - are problems created by success. I sometimes refer to them as ‘growing pains’. That does not make them any less important to deal with but I would much rather be contemplating those issues than the problems of recession and hardship that we inherited in 2013 when I was sworn in as Premier. Just reflect for a moment on how far this country has come in these last six and a half years. Real terms GDP growth has been consistent and strong, averaging 3% throughout the period.

Unemployment has dropped and in particular, Caymanian unemployment has fallen from a peak of 10.5% immediately prior to us coming into office in 2013 and has now been pegged at 4.8% in the most recent labour force survey. As I have said before in this House, there are now 3,300 more Caymanians in employment than there were six and a half years ago. There is every reason to be confident that this track record of success will be maintained through to the end of this term. The economic prosperity that these Cayman Islands have built and then enjoyed during the two Administrations that I have had the honour to lead is a singular achievement. All of us Mr. Speaker, can be proud of the strong Caymanian economy that we have built together.

Problems relating to traffic and to the cost of living are things we can deal with and we are doing so Mr. Speaker. But I fear that there is another problem we face that may be harder to tackle. That is a growing sense of complacency and an assumption that Cayman can continue to prosper by right rather than by dint of hard work.

I beg to differ, Mr. Speaker. The history of the last sixty years tells me that it is only because Caymanians have been willing to lead the way; to develop a business-friendly environment; and to take risks, that we have grown and prospered as a people. Rather than sitting back with a self-satisfied sigh and expecting the dollars to continue to flow in, now is the time for us to bend our backs and lay the foundations for the next generation of Caymanian success.

Now I recognize, Mr. Speaker, that it will be for a future government and the next Premier to pick up the challenge but as I said earlier, I came into politics to do the right thing for Cayman and its people. I will end my time as Premier doing the right thing. That means that even though it will not be for me to see all the plans through, I do believe it is the task of this Administration to sow the seeds that the next administration will reap. Therefore, our plans for the coming budget period include several key pieces of work to position the Cayman Islands for the future.

I should add here, and I am sure you would expect me to do this Mr. Speaker, that I fully expect the next government to be a record third straight Progressives-led Administration. I also fully expect Mr. Speaker that that Government will be able to continue with you in the Speaker’s chair carrying on the good work you have done over the course of this term.

But whatever the verdict of the people in May 2021, the next government will come into office with the benefit of a number of initiatives already under way for them to pick up and complete or to mould in light of their own political mandate.

I want to take this opportunity to highlight four important issues on which Cayman needs to begin to think differently. Two of them I have mentioned already: traffic and housing. The other two are healthcare and economic diversification. Do not get me wrong, Mr. Speaker, I am not just kicking the can down the road on those issues in the hope that a future Administration will deal with them. Rather, I recognize that it is just not possible in the next 18 months or so to fully solve the challenges we now face. But neither is it the case that we have been doing nothing about these issues for the last six years.

In all four cases, there is action the government has already taken and is taking in the short term through the next budget period as I have already indicated. In my view, however, the experience of the last two Administrations indicates we now need to lift our eyes from the kind of pragmatic solutions we have already delivered and address these issues in a more fundamental way. This Government will rise to that challenge and the budget also includes resources to fund the work we are putting in train now to help to identify longer term solutions.

Traffic is a very good example of that. I have already highlighted the huge amount of work that will take place over the next budget period to improve the capacity of Cayman’s road network. It will, as I have said, reduce congestion and improve journey times, especially at peak times. But unless we do more, Cayman’s victory over its traffic problems will be short-lived. All the evidence from across the world is that if you add more road capacity it just fills up with more vehicles.

In the longer term, we need a different answer. In fact, I believe we need a different question: not what is the right solution to Cayman’s traffic problems but what is the best solution for Cayman’s future transportation needs?

If we act now, there is an important opportunity to answer that question in a new and innovative way. The extraordinary growth Cayman has experienced over the last 60 years plus the continued growth in visitor numbers means we are now of a size where new public transport solutions become economically viable. At the same time, although we have grown we still have the physical space to implement an innovative and different solution. However, the challenge is not simply an infrastructure one. It also involves a change in our behaviours, enticing people out of their cars to use public transport options as they become more readily available. Neither the infrastructure development nor the behavior change can be delivered in the next 18 months but we will use the time to work to identify what the best future option for Cayman might be. The Minister for Infrastructure, supported by the Deputy Premier whose remit includes public transport, will commission a public transport study that will be ready to inform the choices to be made by the incoming government in 2021.

Similarly, with housing. The measures I spoke of earlier will have a positive impact but the improvements will necessarily be limited in scope. The current operation of both the main property market and the rental market are moving in a direction that, if nothing is done, will increasingly make housing unaffordable for middle class Caymanian families. As I said earlier this is unacceptable. The issues right now are partly cyclical but the country’s continued economic success means the issue will just not go away.

The longer term trend if Cayman continues to grow is something that government needs to address and not in a piecemeal fashion. There are a variety of tools available to government including planning policies; the use of government’s own land; duty reductions and other concessions; and the potential to offer more direct support to Caymanian home-buyers. Each of these, though, will not be an answer in isolation. Indeed over-reliance on a single intervention is likely just to distort the markets.

A comprehensive, cross-government housing policy is required and we are forming a special inter-Ministerial committee to develop that policy. I expect its report to be available in time to begin implementation through the 2022-23 budget and beyond. The challenge to create new solutions for affordable housing in the context of successful economic growth is being met elsewhere and we can learn from that experience. In California, for example, where the tech boom continues to generate tens of thousands of high paying jobs, the median home price has risen by nearly 75 per cent and the average rent has gone up 40 per cent over the last seven years. On Monday this week, Apple announced it will direct $2.5 billion toward affordable housing initiatives in California, including helping first-time homebuyers with financing and down payments. They join other technology companies including Facebook, Google and Microsoft in pledging to help address the significant increases in rent and real estate prices caused in part by the technology industry’s rapid expansion. Perhaps those who are profiting from bringing in large numbers of workers to Cayman can be encouraged to take a similar approach.

In respect of healthcare, we have another issue with lots of moving parts that we need to consider as one system. Perhaps as this is towards the end of my tenure as Premier, Mr. Speaker, I can speak with a bit more freedom. Frankly, in my view, the system we have developed in Cayman is becoming unsustainable.

Health insurance costs are one of the factors driving the increasing cost of living and yet government is increasingly left to pick up the tab for those who find that they cannot afford to participate in our private insurance-based system. That cost is escalating. For what I think is the first time, this budget contains a more accurate estimate for the likely cost of caring for seafarers, veterans and medical indigents. We have allocated approximately $26M per year to cover that cost in each of the next two years.

This and previous governments have sought to make incremental changes. My Government has tried to find a solution to older persons’ insurance coverage costs but the business cases we were presented with remained simply unaffordable. Both Administrations have considered whether CINICO is still the right model for Cayman going forward. The ongoing review of CINICO we have commissioned explores viable options, which will enable the company to become financially sustainable, be fit for purpose and to offer affordable insurance products and services to the Government and citizens of the Cayman Islands.

The H.S.A. is extending services and improving access, for example through the proposed new health centre for Bodden Town, and this is to be welcomed. At the same time, we have excellent private sector provision of health services on Island but there is limited cooperation between providers.

I must accept, Mr. Speaker, that this is one area of public policy where successive governments have failed to get to grips with the issue. Indeed, I have spoken of this before. The incremental approaches we have reached for have proven illusory. It is my belief that a more radical approach is called for. Central to that needs to be a new role for government in helping to support the health and well-being of our people rather than just dealing with sickness. We need to adopt a much more preventive strategy and to organize services that keep people healthier for longer. This is better for government and better for people.

The logic of an insurance system should support that approach but the relatively small size of insurance pools and the lack of engagement between them and health providers militates against it. While I envisage a new role for government, this is not a question that politicians alone can solve. We need a wider debate on how we should reform and pay for our health system and we need that debate to be well-informed about the costs, benefits and risks of different approaches. The first task for government, then, is to gather the necessary information and carry out the analysis to facilitate that national debate. And once the analysis is done and the debate complete there is need for suitable action.

The last of the four issues I want to tackle in this section of my speech, Mr. Speaker, is Cayman’s continuing economic diversification. This has been, and will continue to be, a Government that believes in opportunities for Caymanians. I will talk in more detail later about the work we are doing in education, in employment and in the small business environment to support Caymanian opportunity - but whatever we do, there needs to be in place a thriving economy in which those opportunities arise in the first place. Put another way Mr. Speaker, those who believe that we should focus on education alone and not also on keeping the economy thriving are suggesting a strategy that will result in merely creating educated people who cannot find jobs.

Cayman’s success as a tourism destination and as an international financial services centre is something we should all be proud of. This Government is certainly doing all it can to ensure the continued success of Cayman in both of those sectors as I shall talk about later. However, that is not enough. Again, recent governments, including this one, have begun to work to diversify our economic base. In part that is a response to threats and to risks, particularly in respect of financial services. However, it is also about opportunity.

Cayman is at its best when it innovates. Both through the entrepreneurialism of Caymanians and through our willingness to work positively with a diversity of talent from overseas, Cayman has been able to develop new and exciting products and services that attract business to these small Islands. Ours has been a kind of pioneer spirit. And yet, in respect of financial services at least that spirit has become less adventurous. In some ways that is a very good thing because it has allowed the legal and regulatory frameworks necessary in modern financial centres to catch up and then keep pace.

But I believe that Caymanian pioneer spirit is still alive and well. The question then becomes where is the new frontier where that spirit can now be applied? This is the key question that we have not really answered in our efforts to diversify the Cayman economy.

So to take us forward, this budget for the first time creates an appropriation for the new Ministry of International Trade and Investment, Aviation and Maritime Affairs. The role of this Ministry is outward facing, presenting a single front door to potential investors in Cayman and ensuring that the jurisdiction is effectively plugged in to key existing and emerging markets. To undertake that role effectively, the Ministry has to work across government and hand-in-glove with the Cayman private sector.

As such it can be the focal point for future efforts to diversify our economy and to create new opportunities that channel that pioneer spirit of Caymanian enterprise. In this next budget period, the Ministry is rather dipping its toe in these waters. We are deliberately starting relatively small. However, if the Ministry is as successful as I believe it can be, then it will grow to be the powerhouse for the next iteration of the Cayman economic miracle.

While it is important for us to create a platform for the future, the people have every right to demand of this government that we should finish what we started. Right across government, in each of our Ministries, we will double down on our efforts to deliver on the promises this Government gave to the people of the Cayman Islands. We have achieved a lot over the last two and a half years. I spoke at length during the SPS debate about this Administration’s achievements and I will not repeat it today. However, as we discussed the priorities for this budget in the Government Caucus, I could not help but be impressed and encouraged by the determination my colleagues are showing to get critical projects over the line.

The most obvious symbol of that determination to carry through on our promises is the new cruise berthing and enhanced cargo facilities.

As I said in the Referendum Bill debate last week, this Government was democratically elected with a clear mandate to get both elements of this vitally important project delivered. Having spent three days in this Chamber last week debating the issue, I will not go over the same old ground again. We are here today to debate the budget and it is worth recording that beyond the enabling works, there are no new resources in this budget to deliver the port redevelopment project. That is, of course, one of the most important achievements of the Government. There is no need to appropriate funding of some $200M for building the port project because the Cayman Islands is not paying for it. The cruise companies will pay for all of the capital costs and then recover their investment and pay for the maintenance and upkeep of the new facilities from the per passenger levy on cruise passengers. I repeat – it will be paid for by cruise passengers and not the people of these Islands. That is a fact Mr. Speaker, no matter who says anything different in whatever way they may say it. In the words of the great Churchill – “The truth is incontrovertible. Malice may attack it; ignorance may deride it; but in the end, there it is.”

I will not repeat last week’s debate but I will pause to recognize what an outstanding achievement it is to have put Cayman in this position.

You see Mr. Speaker; we want the experience for our cruise visitors to be as wonderful as it is for our visitors who arrive by plane. While the upgrades to the Owen Roberts International Airport have brought improvements for the flying public, we will soon see further improvements to the airfield. Works will be done on the apron rehabilitation and extension of the runway to make the airport more efficient and expedite departures and landings.

Accordingly, I want to offer my thanks to the Deputy Premier and Minister for Tourism for his leadership on behalf of the government in moving the port redevelopment project forwards. I have had the privilege to have him as my Deputy for the last six and a half years, Mr. Speaker, and it has been my honour to serve with him. I have valued his support and welcomed his counsel. The last year has been a very difficult time personally for the Deputy Premier and his family. And, as if that were not enough, he has had to suffer personal attacks and efforts to impugn his honesty. Yet he has remained steadfast in his determination to carry through with what he knows to be right for our country and he has continued to operate with the combination of integrity and good humour that we all know to be his trademark. I truly thank him for all that he has done to move forward this Government’s agenda for the benefit of all the people of our Islands. I also thank his Councillor and Member for George Town West for his commitment and dedication to the work of that important Ministry.

Whilst we have had challenges locally moving forward with our cruise berthing and enhanced cargo project, we are also experiencing challenges internationally with regard to defending and promoting our key Financial Services Industry. I do appreciate the company of the Minister for Financial Services but both of us have spent far too many hours in London, Brussels and other European capitals dealing with the plethora of issues our industry faces. That challenge continues. The Minister has been working hard with her team and with the industry itself to make sure that we keep pace with the ever changing demands of the international regulatory bodies. I am very grateful to the Minister for all that she has done to put Cayman in such a strong position to avoid us being placed on a blacklist.

The budget we are bringing before the House today provides yet more resources to aid in meeting that challenge. I have said many times before that Cayman will comply with all relevant international standards and we need to invest in both people and new technology in response to increasing international regulatory developments; the variety of international assessments; and the competitive pressures that Cayman faces.

The investments being made through this budget will enable Cayman to increase in regulatory capacity and where appropriate to take any necessary regulatory action. We will also further boost our engagement with international stakeholders as we run a new campaign to address the very widespread misconceptions about Cayman and to improve the global reputation of the jurisdiction. While we may differ on the cruise and cargo port project, I do hope all Members will support the Government’s promotion of our Financial Services Industry and be willing to campaign with us as we seek to enhance our reputation and promote a positive image of our country overseas.

This budget provides the resources to complete a number of initiatives the government has been putting in place to support small business and create new opportunities for Caymanian entrepreneurs. As the Minister of Commerce has announced, the new Small Business Development Centre will open its doors before the end of the year. The budget we are proposing today ensures the resources are there to ratchet up the services available and extend the reach of the Centre during the first few months of 2020. Other actions from across government will provide further support. For example, the Post Office will develop and launch a second tier of its CaymanKind Global flat rate products, which support small and micro-businesses operating in the Islands’ e-Commerce market as well as being beneficial to individual customers.

I think it is the case, Mr. Speaker, that we have been working on the integrated solid waste management project – or to put it more plainly, on fixing the dump – even longer than we have on the procurement process for the port project. There have been times during the last six and a half years when it felt like we were never going to get there. So it is with some relief that we are now seeing increasing confidence in the delivery of the project.

Even after two years or more, we still have further negotiations to conclude with the Dart-led consortium, which is the preferred bidder for the project, and that is reflected in the budget before the House. Were I superstitious, I would be touching wood as I say this, Mr. Speaker, but the main challenges in taking the project forward are resolved and it is on that basis that both parties have now begun to work together in concrete terms while the contract negotiations are being concluded. There will shortly begin a consultation on the terms of reference for an environmental impact assessment for the new facilities to be constructed under the project, including the waste-to-energy plant. Even more, significantly, work will begin on capping the existing landfill early in the New Year.

Equally important, last month I was delighted to attend the ground-breaking for the new long term residential mental health facility that is being built in East End following the formal signing of the contracts to construct the facility. This will be a purpose-built 54-bed facility that will serve the residents of the Cayman Islands who have serious and persistent mental illness, enabling them to receive high quality care close to their homes, friends and family rather than having to travel overseas.

It is envisaged that the new facility will open in the second quarter of 2021. The budget provides the capital allocations for the building of the new facility and covers the operating costs through to the end of the budget period.

The Minister for Health inherited both of these projects from my previous Administration but he has adopted them and driven them forward as his own with a relentless determination. I confessed earlier that my own confidence wavered as both of these projects hit various setbacks but the Minister retained that determination and was able to reassure both myself and our Caucus colleagues that both could be delivered. I thank him today for his hard work and fortitude. I must also thank, Mr. Speaker, his very able and committed Councillor, the Member for West Bay Central.

Mr. Speaker, President Lyndon Johnson frequently summarized his commitment to civil rights and the great society in the following terms: “it is not enough just to open the gates of opportunity. All our citizens must have the ability to walk through those gates.” These words also get to the heart of the commitment that the last two Administrations have made in terms of opportunity for Caymanians. Much has been achieved and this budget provides the resources to push our work forwards still further.

In terms of opening doors, the over-riding priority over the last six and a half years has been to ensure Caymanians could access employment. I reported earlier on our track record that has seen Caymanian unemployment halved over the period. That success means that 3,300 more Caymanians are now in employment compared to when we took office. I think we can now say that we are getting to the point where there is effectively full Caymanian employment but we will not give up on any Caymanian still seeking employment and we stand ready to support all Caymanians. Moreover, we must recognize that this nation’s hard-won success is always fragile. External economic shocks and natural disasters are always risks in our economy. That is why the government has not wavered in its commitment to continuing to grow the economy.

Our success now also gives us the opportunity to broaden our focus. From a position of strength where Caymanians are more readily able to access employment, we can now redouble our efforts to ensure that there are proper opportunities for advancement in our economy. As I said in my speech to the House introducing the SPS, we will be legislating to create a new Fair Employment Opportunities Commission. The Ministry is in receipt of the initial draft Bill and has been researching similar such commissions in other jurisdictions to provide further drafting instructions to Legislative Drafting. It is anticipated that the Bill will be submitted to the House within the first quarter of the New Year to provide for public consultation. The Commission will work across the whole economy and be empowered to look at the treatment of Caymanians in all sectors and all levels. If there are barriers to the advancement of Caymanians it will be the Commission’s role to ensure they are eliminated.

In this way, Mr. Speaker, we will be increasingly confident that the gates of opportunity are truly open to Caymanians.

As the economy grows and diversifies, the demands for labour will change. Looking ahead, we need to ensure that Caymanians have the skills necessary to access the opportunities of the future. Our design of the new Department of Workforce Opportunities and Residency Cayman has for the first time created within government the capacity to look ahead and to plan the workforce development necessary to equip Caymanians for the future jobs market. The coming budget period will see that new function beginning to operate effectively.

The real key to ensuring that Caymanians are able to walk through the gates of opportunity is to ensure that our education system equips our young people with the skills they need to compete in the increasingly complex jobs market they will face. Significant progress has already been made, Mr. Speaker. The work done in the last Administration to create a new framework for education and to base our plans on a realistic appraisal of the current position of our schools meant that this term we have been able to focus on pushing forward with a meaningful programme to reform the public education system in Cayman.

That programme has been well-thought through and systematically deployed. I will accept the recent criticism of our Auditor General that we have not paused long enough in our delivery of the necessary changes to write it all down but our strategic intent has been clear. Reading the Auditor General’s criticisms, I am reminded of a letter written by the Duke of Wellington in 1812 as his army chased Napoleon out of Portugal and Spain. In response to the repeated Foreign Office requests that he account for his actions and the deployment of his troops, the Duke wrote:

“This brings me to my present purpose, which is to request elucidation of my instructions from His Majesty’s Government so that I may better understand why I am dragging an army over these barren plains. I construe that perforce it must be one of two alternative duties, as given below. I shall pursue either with the best of my ability, but I cannot do both: 1.) To train an army of uniformed British clerks in Spain for the benefit of the accountants and copy-boys in London or, perchance… 2.) To see to it the forces of Napoleon are driven out of Spain. Your most obedient servant, Wellington”

This Government has made clear how we see our present duty, Mr. Speaker and that is to drive forward the improvement of public schools in Cayman. I want to express my gratitude to the Minister for Education for her leadership of the reform programme and her dedication to ensuring that our education system delivers opportunities for all our young people. I also thank the Member for George Town South and Councillor for Education for her commitment not just to educate our young people but also for the care she gives to the elderly in her community.

The first stage has been to get the basics right. The biggest single contributor to improving standards of education is to improve the quality of teaching. This budget completes the commitment we made to increase teachers’ salaries to a monthly minimum of $5,000 so as to attract and retain the best in the profession. We are continuing to invest in the development of our teachers and the quality of our school leaders. Across the country, school inspectors are now finding improvements in the quality of teaching and their overall assessments of schools’ performance are moving in the right direction.

The second stage is to ensure that what is being taught by our high quality teachers is appropriate for our young people. This term has seen a new curriculum introduced into Cayman’s primary schools. Yes, it is more challenging and yes there will be difficulties as we all adjust to the demands of the new curriculum but we would be failing another generation of Cayman’s young people if we did not make this vital change. The budget before the House today provides the resources needed to support the successful roll out of the new curriculum across our public education system.

While this challenging new curriculum will raise academic standards, we must also recognize that some of our young people will want to pursue other opportunities. For them we need to ensure that appropriate technical and vocational routes are available to them. I will stress that vocational training is not to the exclusion of all academic education. In my view, vocational routes are themselves underpinned by a firm grasp of the basics – reading, writing and mathematics. Beyond that, the best vocational routes are developed as partnerships between educators and the private sector. That is the approach this government is taking and the coming budget period will bring that work to fruition.

In the meantime, the government is extending its own efforts as an employer to deliver high quality vocational training for a new generation of Caymanian tradespeople. Funding provided in the current budget is allowing the construction of a dedicated apprentice training facility at the Public Works compound and the upgrading of PWD’s electrical, plumbing, AC and carpentry workshops to make them suitable for apprentice training in addition to their normal work use.

Currently construction is on target for completion by December with a facility opening and launch of Level 3 (Supervisory) Training in January of 2020. This coming budget allocates funding to support the continued development of PWD's apprenticeship programme. By this time next year the program will expand to 50 Caymanian apprentices in training including customized classes for persons already working in the industry who need to be up-skilled or certified in their particular area of expertise or to access emerging opportunities within the sector.

Finally, Mr. Speaker, we need to finish one piece of strategic reform that has been on hold while we have been rolling out the new curriculum. That reform is the introduction of new governance arrangements for Cayman’s public schools. I said when speaking to the SPS that this reform was essential in placing responsibility for improvement where it really matters – with schools themselves. School governance arrangements that engage teachers, parents and the wider community in the running of local schools have been shown the world over to support school improvement and this is the model Cayman needs to adopt.

I will just pause here, Mr. Speaker. I understand that when I spoke about these governance changes during the SPS debate I upset some people by suggesting that decisions about what happens in classrooms were better taken by schools themselves rather than by the Department of Education Services. I really can’t apologize for that, Mr. Speaker, I believe it to be true.

However, I do apologise for what was left unsaid. Just as the change benefits schools by giving them the freedom locally to drive their own improvement, so it also frees the Department to refocus its time on the key national programmes that provide the necessary frameworks for local improvement. In my view, this change clarifies the role of both the schools themselves and the central department and benefits both by allowing them to concentrate on the things that they are best placed to do. I hope I haven’t offended anyone again and I have now made myself clear.

Since I spoke on the SPS, the Education Council has been working on the development of the new governance model for Cayman’s schools. I thank them for the work that they have done and I look forward to supporting the Council and the Ministry as they put the changes in place during this two-year budget period.

Alongside these vital changes in the education system, the government in this budget is continuing to invest in the necessary upgrading of the schools estate. The centerpiece of that programme of capital investment is, of course, the new John Gray High School campus.

Despite what some cynics in the blogosphere might have everyone believe, the John Gray High School project is progressing well. The last update I received indicated that the target opening for the whole of the new facilities remains the start of the 2021 academic year with the potential for some of the new facilities to come on-stream before that date.

Alongside the John Gray project, other capital investments programmed for the 2020-21 budget period include works to improve the primary school estate, most notably an upgraded hall at the Bodden Town Primary School. Taken together, these investments both increase the capacity in Cayman’s public schools to meet the demand for places and help to create the kind of positive learning environment that supports quality teaching and learning.

On a related note, Mr. Speaker, this budget provides the financing to take forward the new Sunrise Adult Training Facility. I recognize that this is long overdue but I am delighted that it has now been possible to find the necessary resources. Again, Mr. Speaker, it is not just the new building itself that is important, welcome though I am sure that will be. Within the building will be better, more modern equipment. Taken as a whole, the new facilities will greatly enhance the opportunities for training and personal development for up to 150 Caymanians with special needs.

The appropriations in the budget before the House also complete a number of important changes this Government has been driving in order to reduce crime and ensure that Cayman is a safe place to live, work, visit and do business. Before I do that, Mr. Speaker, I must just alert the House to a change in the way that the RCIPS appropriations are presented in this budget. There is a heading in the budget titled “Appropriations to the Premier on behalf of the Office of the Commissioner of Police” which is new. Previously those appropriations had been shown within the Ministry of Employment and Border Control for which I am responsible.

The change of substance that lies behind this change in the tables in the budget book is that it effectively recognizes the RCIPS at the Ministry level in Government terms rather than at the Department level. The consequence of this is that the Deputy Governor is inviting the Commissioner of Police to act as a Chief Officer and to be part of his formal leadership team. This will facilitate further integration of the activities of the RCIPS with other Ministries for the benefit of the government-wide approach to keeping communities safer. I fully endorse the change.

What the House will see within RCIPS allocations further underlines this government’s commitment to providing the resources needed for the effective policing of these Islands. The budget provides the funding necessary to complete the three-year commitment we made to recruit 75 new police officers and to support the refocusing of policing on to a neighbourhood approach. And just this month Mr. Speaker, 11 Community Safety Officers have been assigned to work in our communities. These officers aren’t police officers, but civilian members of all our districts who patrol communities and identify areas and issues of concern while helping bridge the gap between the police and the community. The implementation of this new service, funded through the budget before the House, represents the delivery of yet another of the promises made by this Government.

These changes plus other things such as the new RCIPS app are bringing the police much closer to the communities they serve and ensuring that policing is much more responsive to the needs of those communities. Additional policing is continuing to help keep Cayman safe Mr. Speaker. In April, I spoke about reductions in the burglary rate and I am pleased to say that current indications are of a continuing downward trend in serious crime across these Islands.

For example, the positive reduction in burglary rates has been carried on into this year. In 2017, the average burglary rate was around 42.5 per month. Last year’s successes had brought that down to 27 per month and the continued focus on neighbourhood policing and action against persistent and prolific offenders has reduced the average for the first nine months of 2019 to 23. I will say again that for victims the overall reduction is small compensation but for the country as a whole it is the dividend from the Government’s continuing delivery of our commitment to keeping our communities safe. I want to recognize the success these trends represent and thank the Commissioner and all his staff for their hard work.

We are also investing in the physical assets and equipment that a modern police force needs. You will have seen in the press only recently, Mr. Speaker, that the RCIPS has acquired a new class of state-of-the-art, fully-equipped vehicles. More will come into service in the coming budget period. We are providing the full year funding for the new police helicopter and indeed for the second helicopter that will arrive next month and extend further the capacity of the RCIPS for operational policing, border security and disaster management.

I am sure that you will be pleased to hear, Mr. Speaker, that we will be progressing the development of the new West Bay police station. Funding has also been provided for the RCIPS to help in the fight against money-laundering and terrorist financing and the new digital forensics hub creates new capacity to investigate and tackle cybercrime.

I have made the point in this House many times before but I will do it again – community safety is not just a matter of policing. I have been greatly encouraged by the recent efforts of the National Security Council to develop more of a whole-of-government approach to keeping Cayman safe. Particularly important in that respect is the development of an anti-gang strategy, led by the Deputy Governor personally. The budgets going to a number of Departments and entities will fund activities as part of the delivery of that strategy. The benefits are two-fold. First, the disruption of gang activity makes a significant contribution to reducing crime. Secondly, and perhaps more importantly in the long run, the implementation of this strategy improves the life-chances, particularly of young people, who might otherwise have been caught up in gang activity and fallen into criminality.

Alongside that work to combat gang-activity, the government is continuing to support vulnerable young people and families. The Police will ensure that their officers continue the prioritisation of investigations related to child abuse and domestic violence through the Multi-Agency Safeguarding Hub (MASH). Other government agencies, notably the Department of Children and Family Services will support that work. The budget secures the funding for the opening and operation of a new Special Needs residential facility for children in care to ensure they receive dedicated and appropriate care at a time when those young people are particularly vulnerable.

More broadly the budget includes a capital allocation to fund the next stage of the court house redevelopment project that will see facilities for the Court of Appeal in the Government-procured Scotia building, a new six-storey court facility and a renovation of the existing courthouse to provide additional courtrooms. The budget also takes forward the much-needed work on a new prison facility to replace the existing male and female prisons at Northward and Fairbanks to provide modern facilities for all types of offenders in a single location.

We are also making new investments in the fire service including replacement fire trucks and new safety equipment to enable firefighters to carry out their duties more effectively.

The new Coastguard service will also continue to move forward thanks to resources provided within this budget. Of particular note is the capital allocation being made to purchase new vessels and to upgrade equipment in the new service. This investment is being made in part as a response to the need for enhanced border security but the remit of the Coastguard service goes well beyond that.

In particular, the Coastguard will greatly enhance both the capacity and professionalism of Cayman’s maritime search and rescue capability. The key to the successful and effective roll out of our new Coastguard service is its new Operations and Rescue Coordination Centre, which will become fully operational next year.

Cayman’s new Customs and Border Control Service has now been operating successfully for some time. The guiding philosophy for the creation of the service has been a move from routine revenue collection and immigration control to a more integrated and intelligence-led approach. As the nine months of operations have shown, it is possible both to tighten Cayman’s borders against potential criminality and other threats and to make life easier for legitimate travellers. Investments proposed in the coming budget period will continue the success of the changes already implemented. For example, plans to introduce new electronic passport kiosks for immigration are funded as part of this budget.

Of course, we have not forgotten the Sister Islands and the coming budget will see a number of important projects delivered for the benefit of communities there. We will complete the renovations and additional buildings for District Administration in Cayman Brac; the parking lots and hard courts for tennis at the Brac Playfield; and the interior works to the Multi-purpose Hall. Work will also be undertaken to construct the Little Cayman Boat Launch Ramp and Jetty.

Mr. Speaker, this budget is one that delivers the priorities not just of the government but of the country. We are able to take action to respond to the immediate concerns being voiced by communities across these Islands at the same time as making good on the promises we made when this Unity Government was formed.

We are able to deliver against today’s priorities while also recognizing that some of the challenges Cayman will face in the years ahead will require different responses. Rather than put off meeting those challenges for some future government to face, even at this point in the electoral cycle, this Government is willing to begin the groundwork that will enable governments to come to meet the challenges we face full on.

We are able to do all that, Mr. Speaker, only because of the past six and a half years of careful restoration of this nation’s financial health. When the previous Administration was elected in 2013, we set out a very clear and unambiguous financial strategy.

We would ensure the careful stewardship of public finances to bring the government into compliance with the requirements of the Public Management and Finance Law.

We would do so through restraining government costs and at the same time we would not impose any new fees or taxes. In fact we would reduce them where we could.

We would pay down government debt and we would not enter into any new borrowing.

Six and a half years on and this government has maintained that successful strategy. This budget adheres to the strict fiscal principles that have guided us throughout our term. This budget remains in full compliance with the PMFL. This budget delivers our spending priorities but still ensures a healthy operating surplus. Fees and duties are once again held steady and previous reductions are maintained. The ambitious capital investment programme we have set out is being paid for from revenue without any need to borrow. This is a track record of successful financial management that any government in the world would be proud of.

Once again, I thank the Minister of Finance for his sage financial advice and for the positive way he has taken forward the financial strategy we put in place. I am also grateful to his Treasury team led by the Financial Secretary for all the endless hours of hard work that has gone into pulling this budget together and to the Deputy Governor and his Chief Officer colleagues for the support and advice they have given to the government Caucus to help us in making the policy choices to which this budget gives financial expression. Of course, I must also thank the Deputy Governor, Cabinet Secretary and Attorney General for their work as members of Cabinet.

I want to pay special tribute to my friend the Attorney General, whose counsel to the government and me over the past few years in particular has been invaluable. Through the seemingly endless stream of difficult legal challenges, he has been supportive, sage and steadfast.

Allow me too, please, to single out the Chief Officers in the ministries for which I hold Constitutional Responsibility – Samuel Rose, Eric Bush, Teresa Echenique, Wesley Howell and Michael Ebanks, who is currently acting in Mr. Howell’s stead – and to thank them for their tireless efforts to find ways to squeeze ever more in terms of results from the pot of resources available. As I am sure they will testify, it is not always an advantage to be the Chief Officers for the Premier’s Ministries. Equally Mr. Speaker, the team that supports me in the Office of the Premier often work long hours and so I wish to also thank Roy Tatum, the Head of the Office of the Premier, along with Kieran Stiegant, Julie Hutton, Tammie Chisholm, Jana Pouchie-Bush and Frank Cornwall for their support and dedication.

So let me be clear, Mr. Speaker, this budget, like all others, has required us to make choices. There are always things that we would have liked to be able to fund but for which we could just not find the money. There are investments that would yield benefits to Cayman that are just not affordable at this time. The process we have gone through as a Caucus has allowed us to work through the alternatives and the package of proposals that were finally included in this budget represent the result of a very long and sometimes quite painful debate. I must thank my Caucus colleagues for their support, their advice and their patience over the last few months as we have put this budget together. On behalf of myself and I am sure, all my Ministerial colleagues, I want to thank our four Councillors for their help and support, which all too often goes unnoticed outside of Government itself. The long hours they have put in to help get this budget right are very much appreciated. For myself, I am sure there are many things I will miss about government after I step down as Premier. The budget process is unlikely to be one of them.

That said, the outcome of the process is a budget that I am proud to commend to the House today.

This is a budget that gives a much-needed boost to older persons and the vulnerable in our community. It is a budget for families. It is a budget that will bring relief to commuters. It is a budget for opportunities as we bring to fruition the development of WORC and continue to drive forwards the improvements of our education system. It is a budget to tackle the issues faced by our people today and a budget that provides a platform from which we can better meet the challenges of tomorrow. It is a budget that makes good on the promises this Unity Government made to our people.

No doubt you remember as I do, Mr. Speaker, the tough negotiations that went into putting that programme together. There were those who at the time very loudly proclaimed that it would all end in tears, that the government we had put together would not survive the first encounter with the harsh realities of political decision-making.

We have proved the naysayers wrong. We have done so because the members of this Government have been willing to set aside our political differences and work together in the best interests of this country. This budget is yet further demonstration of that and I ask the House to vote ‘aye’ so that this government team can get on and deliver the programme of action that we are setting out.

Mr. Speaker, before I close I want to speak to two matters that are of such significant importance that I believe they warrant our immediate attention.

The first Mr. Speaker is with regard to the ruling yesterday on same sex marriage by the Court of Appeal. In a press release yesterday I welcomed the news that the Court of Appeal had agreed with Government that the original ruling of the Chief Justice in the case regarding same sex marriage created significant ambiguity surrounding the Constitution and Bill of Rights and the interpretation of and ability of the Court to amend laws.

We have always said that it was critical that the country had the benefit of clarification on these very important constitutional issues. The Court of Appeal judgment does clarify that and I believe this is a significant ruling.

That said, Mr. Speaker, while I - and I suspect that all of us in this House - do appreciate the ruling, we should be mindful that it comes with a declaration by the Court that this legislature should act ‘expeditiously’ in ensuring that same sex couples have legal protection under a law that provides the “functional equivalent to marriage”.

Mr. Speaker, I do expect that this Honourable House will indeed consider this matter expeditiously but we cannot do so hastily. Given that we have before us a two-year budget to get through as well as a Referendum, I do not see this Honourable House turning our attention to this issue before early next year. In the interim I do urge members to read and carefully consider the judgment and the declaration. It is clear to me that if this Legislature does not provide the legal framework that provides the protections for same sex couples in a form that is acceptable to all Caymanians, then undoubtedly we will end up with the UK levying upon us protections that suit them rather than us. I believe the responsible thing for this House to do is to face up to this issue and take its own decision. We have rightly complained that on occasion the UK has over-reached by interfering in matters that should be decided by Caymanians. By the same token, we cannot abdicate responsibility for taking the hard decisions when they are staring us in the face.

The second matter concerns Constitutional amendments.

Mr. Speaker, on 17 December, 2018, I provided this House with an update on the Constitutional talks that were had with the UK and a Cayman Islands delegation headed by me. The Cayman delegation included the Hon. Attorney General; The Minister for Commerce; The Minister for Financial Services; the then Leader of the Opposition, the MLA for North Side; The Deputy Leader of the Opposition, the Member for Newlands; and various support personnel. We were ably assisted by Sir Jeffrey Jowell, QC.

The discussions went well, Mr. Speaker, and indeed it was good to have the leadership of the Opposition present who, along with Government, spoke with one voice to indicate to the UK representatives that what was being sought had the support of both sides of the Legislative Assembly.

These were important talks, Mr. Speaker, and those present on both sides understood this. For they had as their genesis the real need for our Islands to better protect the hard won progress over the past sixty years toward appropriate local control of local affairs. This is important not just to insulate ourselves against unwarranted interference and overreach by parliament in the UK, but also to ensure that we maintain the ability to grow our economy and control our own political future. And we were able to be persuasive across a number of necessary changes, some of which I will mention below.

Regrettably, although we had broad agreement at the time, the all-consuming Brexit debate in the UK halted the package of agreed changes moving to the Prime Minister, who at the time was Theresa May.

Fortunately, Mr. Speaker, we have managed to get things unstuck and I am awaiting an imminent letter from Lord Ahmad on the final package of changes that has now been approved. Much time has passed since those initial conversations and those that ensued earlier this year. However, once I have the letter and the approved changes, I will advise this Honourable House and the public.

As I have said often, these changes ought not to be controversial and are aimed at protecting our Islands and our ability to guide our own future. Members of this House regularly rail against what we consider overreach by the Governor, Foreign and Commonwealth Office and UK Parliament and we protest them interfering in our affairs. These changes are principally aimed at limiting the ability of the UK to interfere locally. They include:

Safeguards to clarify that the Cayman Islands has autonomous capacity with respect to domestic affairs;

Abolishing the power of the Governor to disallow legislation passed in this Legislative Assembly;

Abolishing the Governor’s reserve power to enact legislation unilaterally – subject to the ability of the Governor to address parliament under certain situations;

Clarifying that any obligations imposed on the Islands by the Governor, UK Parliament, or the Crown be consistent with the constitutional rights, freedoms, and responsibilities under part 1 of the Constitution;

Removing the Governor’s exemption from the duty to consult Cabinet, and that the exercise of the Governor’s and the Secretary of State’s powers would not be immune from judicial review;

Increasing the number of Ministers in Cabinet from 7 to 8;

Clarifying that Ministers may be assisted by individual MLAs now known as Councillors – such MLAs will instead be referred to as Parliamentary Secretaries;

Establishing a new Police Service Commission;

Renaming the Legislative Assembly to Parliament;

Abolishing the requirement for the Governor to approve Standing Orders made by this House;

Including the functions of the Cabinet Secretary in the Constitution.

These, I believe Mr. Speaker are the main items that had some form of initial agreement. I say again that I am awaiting the approved package, but I do believe that most if not all of the aforementioned will remain part of that package. We shall see.

But Mr. Speaker, I say again that none of the above should give any member of this House or the public any cause for undue concern. They are aimed squarely at strengthening our Constitution in key areas given the maturity and confidence in ourselves that our Islands have shown over the past sixty years. They also provide, as I said Mr. Speaker, some insulation from the overreach of the UK Parliament that has threatened us and continues to threaten us.

When those threats come, as they have before Mr. Speaker, we in here wax lyrically but all the talking we do is for naught unless we put ourselves in a stronger position constitutionally.

So when the approved package of changes is here, and we start the debate them, I pray that we in this House are able to put aside partisan politics and take up national pride and support the changes – just as we did in December last year Mr. Speaker.

If I may end on a personal note, Mr. Speaker, last April when I finished my speech introducing the SPS, I recognized that there was still much work remaining for this government to do. I gave a pledge then that I would give everything I have to get it done. I repeat that pledge to the House and to the country today.

In As You Like It, playwright William Shakespeare wrote:

All the world’s a stage,

And all the men and women merely players;

They have their exits and their entrances;

And one man in his time plays many parts,

My exit as Premier may be coming, Mr. Speaker, but I have a few parts yet to play. In the time remaining I will redouble my efforts and focus my full capacity on achieving the goals that this Government has set out in the budget presented today.

I commend that budget to the House.

May God continue to bless these Beloved Isles Cayman.

Oct 28, 2019

Cayman Cruise Berthing and Enhanced Cargo Fa...

Oct 28, 2019

I pause here to point out that in 2013, three members now sitting opposite were part of the Progressives slate of candidates. They were the Member for Savannah; the Member for Newlands; and the Member for George Town Central. Indeed their smiling faces appear on the cover of the Progressive’s 2013 Manifesto, which I would like to now lay on the table of this Honourable House. For completeness Mr. Speaker I also lay on the table a copy of the Progressives 2017 Manifesto.

Mr. Speaker everyone in this House, and indeed the wider public, are well aware that a cruise berthing facility has been talked about for more than 20 years. Certainly, every Government elected since 2000 has had promises of a cruise port in their election manifesto or as part of their delivery plans.

When the last Government that I led took office in 2013 we set out on a complex process that we knew was necessary to get the port project to the finish line. Two years later, in September 2015, I advised the country that whilst the Cabinet would be m making a formal decision in the coming weeks, I was able to state then that the Government had done the work necessary and carefully considered the information before us and was convinced on the merits of building a cruise berthing and enhanced cargo port.

On the 28th October, 2015, four years ago to the very day Mr. Speaker, the Deputy Premier and I announced to the country at a press conference that the Cabinet had considered the various professional reports on the project and had agreed to move the cruise berthing and enhanced cargo port project forward. This included progressing the work to devise a workable financing model. Throughout we have followed a rigorous process that included independent legal and accounting experts, engaged the major cruise lines, and satisfied the United Kingdom Government as well as local Government officials. This is not some ‘Johnny-come-lately’ project Mr. Speaker that we have pulled out of our back pocket. This is the result of years of hard work by the best professionals available and that rigorous process has been carried through to the selection of the preferred bidder Verdant Isle and the extraordinary professionals that they have working with them.

That is, in brief, the history of the project, Mr. Speaker. But despite all that we have done there are a number of people who do not agree with the project and have been able to obtain the required number of signatures to trigger a people-initiated referendum to decide the future of the cruise and cargo port.

And that brings us to the process that we are here today to debate.

A people-initiated referendum is provided for under Section 70 of the Cayman Islands Constitution Order, 2009. That provision is not there by accident, Mr. Speaker. I am sure you will recall that I and my Progressive colleagues campaigned hard for its inclusion and I believe it is an important democratic safeguard within our governance arrangements. Creating a power that allows voters to call a referendum in this way means that no government is able to exercise unfettered authority without any check between our four-yearly elections. This is particularly important should voters become concerned that a Government is acting recklessly or carrying out major initiatives that are controversial and were not part of its election platform.

That said, the referendum power cannot be a vehicle for special interests to seek to over-ride the results of free and fair elections. Therefore, the power to trigger and to pass a binding people-initiated referendum is rightly subject to high thresholds. If government’s ability to carry on its business is subject to check by “the will of the people” then we must be sure that it is truly the will of the people that is being demonstrated.

The threshold that petitions for a people-initiated referendum have to reach in Cayman is 25% of registered electors - and that is a high bar indeed. As it should be. Which is why the verification process was necessary to confirm beyond doubt that, in this case, the required threshold had been reached. Once again in this House, I would like to thank the Supervisor of Elections and his staff for the efficient and effective way in which they went about verifying that the necessary signatures had indeed been collected from registered electors. I had no doubt that it could be done despite the accusations and fear-mongering of the opponents to the port project – but they were proven wrong Mr. Speaker. The process was done in a timely manner and the Government moved swiftly to set the referendum question and date as we promised the country that we would.

I recognize that the collection of over 5,000 signatures on any petition is the product of a lot of hard work and perseverance by a great many people. As a politician, I admire and welcome good-spirited political activism. In the long run, our democracy is stronger if more people engage in the political process. Despite reports to the contrary, I have no argument with the principle of utilising the referendum process to challenge the government’s plans.

However, I think we can all agree that this referendum process has not been without its challenges for all sides involved. And so I believe this House should return to the issue of how the people-initiated referendum provision in the Constitution should operate once this experience is behind us - but those are practical issues; not points of principle.

For those who falsely claim that I and the Government deliberately omitted passing a Referendum Law, I can tell this House and everyone outside of it that I join the voices of those who say they wish that one was in place. For if it was, Mr. Speaker, a Referendum Law would not have allowed any group to take a year or more to gather the signatures required for a referendum. Nor would it likely have allowed a referendum to be called against an important national project that was part of an election campaign and has been ongoing for over five years, and where millions of dollars from the public purse had already been spent – particularly where nothing fundamental has changed during the course of the project. My point is that if we did have a Referendum Law in place, Mr. Speaker, it is unlikely that we would be having this debate here today.

Interestingly, Mr. Speaker, there is no requirement in the Constitution or elsewhere for any campaign behind a petition for a referendum to be based on truth. Nor is there any requirement to keep vested interests, including commercial interests, from being involved in such a campaign. Nor is there anything to prevent the government’s opponents from using a petition as a vehicle for their wider opposition to the government’s agenda.

Certainly, during their campaign, the leadership of the CPR group has utilised all manner of scare tactics and misinformation to persuade people to sign the petition for a referendum. Indeed, Mr. Speaker, in my view the leadership was disingenuous when they told the public that their goal was not to stop the port, rather they merely wanted more information on the project. Their real aim as everyone in the House knows full well, was to get enough people to sign their petition by fair means or foul with the hope to derail the project. And they were ably assisted by an online blog and a radio talk show.

Mr. Speaker, now that they have obtained those signatures we can see their true stripes emerge as they now actively campaign to stop the port project; even as we are finally in a position to provide the information they claim they need. They understood Mr. Speaker that a people-initiated referendum is a numbers game and, in this case, the campaign has done what it thought it needed to do to achieve the numbers required for one to be called. And I and the Government accept that.

In response, and acting in good faith, the government has therefore moved as quickly as possible to bring forward the Bill before the House today. But the Government acting in good faith should be no surprise Mr. Speaker – we have at all times ensured that we have not only acted legally but in good faith. The Country will recall Mr. Speaker that when we announced the preferred bidder back in July that I gave an undertaking on behalf of Government that we would not move to finalise a contract with Verdant Isle in order to allow sufficient time for the Referendum process to come to a conclusion. And even as we head to the requested referendum the leadership of the CPR group have moved from one complaint to another to seek to either delay the referendum or have the government change the rules in the Constitution and in the election law that govern the process for a binding people-initiated referendum so as to improve their position for success and to derail the port project.

This morning the Compass published a letter from an individual who signed as Francis Ebanks. I will read the letter because I find it very instructive.

Permit me a few lines in your paper to share my views on the debate about the referendum on the port.

I’ve heard campaigners opposed to the project, those who clamoured to let the public decide the fate of the project, now complaining that government has respected the wishes of the people and set the referendum date.

First, they complained that it was taking too long to verify the signatures. They wanted this process rushed through.

They then complained that government might drag their feet on setting a date. Referendum Day has been set for the earliest government has found feasible, especially with having to return to the Legislative Assembly to formalise the process. Now, these campaigners, along with opportunistic Opposition MLAs, are saying it is set for the worst possible date.

They previously complained about dredging and government took that into consideration and revised the plans to ensure there would be as little dredging as possible. Yet, their complaining continues.

I am puzzled why many of these people are opposed to a project that will bring considerable economic benefits to Cayman. They call themselves campaigners, but I think they’re more aptly called complainers because every step along the way, they have found something to complain about.

Perhaps it is the public who should be complaining about the undue concern these campaigners caused by claiming China Harbour had the deal at a cost of $300 million-$400 million. The country was in near uproar. When the truth was announced, Verdant Isle turned out to be building the dock and cargo port for $200 million.

Wild campaign claims and propaganda will not fool me anymore. My source for information will now be the government.

I can’t wait for the referendum to be over so we can move forward and have a modern port that will keep food on the table of countless working-class Caymanian families. However, I will not be surprised if on 20 Dec. they find something new to complain, oops, I mean campaign, about.

The CPR will not succeed Mr. Speaker not even with their most recent tactic of obtaining a legal opinion on a variety of issues to do with the referendum. I will repeat here what I have told the media - the government has also taken legal advice on the conduct of this matter from our customary noted constitutional counsel in London and we are more than satisfied that the process being followed is fair and proper and constitutional in every respect.

I will say again that what is becoming increasingly clear, however, is that the CPR leadership and their financial backers are not really interested in holding a referendum, presumably because they think they will lose, but are simply intent on derailing the cruise port and cargo port project by any means possible, including frustrating it by delay.

The Government will not allow that to occur. If the CPR leadership and their financial backers (and perhaps the real leaders of the CPR campaign) really believe they have a legitimate challenge to the process being followed by the Government, they should immediately apply to the court for leave for judicial review and have the matter adjudicated by the court rather than debated in the media.

To further demonstrate the real purpose of the port opponents Mr. Speaker I note that even before the petition had been received by Cabinet, there was public speculation by the opponents to the port that the government would do all in its power to avoid a public vote. They said we would ignore the petition and declare that the project did not rise to the level of being an issue of national importance as required by Section 70 of the Constitution. Yet again this was proven untrue. Indeed the government has always maintained that the project to deliver new cruise berthing facilities and enhanced cargo facilities is essential for Cayman’s future. The project is and has always been, an issue of national importance and that is confirmed in Section 4(1) of the Bill before the House today.

Section 4(2) of the Bill goes on to set out the question that will be put to the people in the referendum. Again, prior to the publication of the question, there were all sorts of conspiracy theories being circulated that the government would introduce a biased question. At no point, Mr. Speaker was there ever any discussion within government to create a biased question. Quite the opposite. As I said when the question was published, we have bent over backwards to ensure that the question is as fairly worded as it can be. We have drawn as far as we could on the intent of the petition and the campaign behind it and we have developed the wording in accordance with very clear principles. As a result, the wording of the question as far as possible accords with the position of the Council of Europe’s Commission for Democracy Through Law in its Code of Good Practice on Referendums, last revised in October 2018. The Code has been accepted by 47 European democracies and thus provided an appropriate yardstick by which Cabinet could consider the question.

Mr. Speaker, from the inception this project has been envisioned, planned, designed, financed, and put forward in the Request for Proposals as an integrated cruise berthing and enhanced cargo port facility. That cannot be factually disputed. A vote for or against one part of the project is a vote for or against the other. But again, rather than accepting what is fact, the CPR leadership is misleading the public into believing that the projects are separate. And so they are objecting to the inclusion of the planned enhancement of the cargo port facility within the question. Members of the CPR group and some members of the opposition argue that the petition was about cruise berthing, not the cargo enhancements and that therefore the referendum question should only relate to cruise berthing.

Let me then deal now with that objection. There are reasons of principle why the objection cannot stand and reasons of practicality. The principle is this: Just as the government has striven to ensure the question is fair to opponents of the port development, it must also be fair to the project’s supporters. This has always been a single project in which the two elements would be taken forward together. I am aware that some Caymanians are convinced of the need for enhanced cargo facilities and see the cruise berths as necessary to fund those enhancements. Their support for cruise berthing is therefore dependent upon and cannot be separated from the cargo elements.

From its inception, as I have said often, this has been an integrated project and the procurement was begun and has proceeded on the basis that the successful bidder would deliver both the cruise berthing the tourism industry needs and the cargo port enhancements that the whole country needs. The two things cannot now be disentangled. They are indivisible.

This leads us to the practical problems. While I disagree, as I will detail later, our opponents believe that the government is not putting enough information before the people to allow them to decide this issue. What information could we put forward solely on cruise berthing? There is none. Just as an obvious example, there is no disaggregated financing model to show how the costs would be met and there is no design we can show people of just a cruise facility. In any case, that does not make sense as no-one (I don’t think) is advocating that the cruise berthing should go ahead without any cargo enhancement.

Some people believe the cargo facilities should be moved but similarly, that is not an available option either. Nor, if the question just dealt with cruise berthing, could we answer people’s very obvious questions about how the necessary cargo enhancements will proceed without the cruise berthing going ahead.

This is a single, integrated project and always has been. It is disingenuous in the extreme to suggest otherwise at this stage. So, Mr. Speaker, it is entirely appropriate that the referendum question includes both the cruise and cargo elements. The voters, in deciding the fate of the project must know what is at stake when their vote is cast.

The referendum question set out in Section 4(2) of the bill conforms to the set of common sense and natural justice principles that Cabinet agreed to test it against. The question is clear and simple; it gets to the point of the issue at hand; it is unambiguous and definitive including in terms of the consequences of the vote, and it is neutral. Those who criticize should bear in mind that neutrality means being fair to both sides.

The other issue dealt with in Section 4 of the Bill is the restatement of the requirement, set out in the Constitution, that the votes of more than 50% of registered electors are needed for the referendum result to be binding on the government. Perhaps I should not be surprised but the government has come under fire even for this. So, at the risk of repeating myself, the requirement to achieve over 50% of electors for the result to be binding mirrors Section 70(3) of the Constitution. It has not simply been dreamt up by the Government.

Those who accept the Constitutional realities sometimes go on to argue that we should amend the Constitution to drop that provision and make the referendum a straight majority vote. Leave aside first, the intent behind the Constitutional provision. Leave aside second, the need for due process to amend the Constitution. Leave aside that it is not in our power to amend the Constitution. Instead, just imagine changing the rules right as the referendum is being legislated for. Suppose, the government brought forward a change to increase the threshold to 60% or 70% of the electorate. Our opponents would rightly cry foul. Everyone knew the rules when this process began. There is no legitimacy in changing those rules now.

What is even more bizarre is the charge that I am somehow using this provision to thwart the requirements for a secret ballot and thereby intimidating civil servants and others. The logic – if indeed you can call it that – goes as follows. I have supposedly told voters that if they support the cruise berthing and cargo project they should simply stay at home. This means - again following their logic - that only “no” voters will turn out at the polls. The government will, therefore, know who voted and that they voted no. And by extension, if civil servants turn out to vote no they will be identified as such and subject to victimization.

This is an argument that is based on a false premise; its tortured reasoning is nonsensical; and it reaches a totally invalid conclusion. I would have thought better even of the self-appointed brains trust that concocted this nonsense live on a radio talk show. And to hear this paranoia repeated on the radio by some of my colleagues who sit opposite is even more remarkable.

First, I have not told supporters to stay away from the polls. What I have done is explain to the country the consequences of staying at home if that is what they chose to do. The onus to stop the country moving forward with building the cruise berthing and enhanced cargo facilities we need rests with those who have brought the referendum and who need to meet the 50%+1 target to make the referendum binding. This is Cayman’s first people-initiated referendum and all involved have a duty to explain to the public how it works. No doubt if I had not talked about it, I would have been accused of trying to hide this from voters. Again, so we are clear, I welcome support at the polls from those who want to come out and show their backing for this much-needed development.

Even if I had advised people to stay at home, why do these particular conspiracy theorists imagine that everyone would simply obey my command? It might on occasion be tempting to wish that I could simply utter a few words and everybody would fall in line but that is just not a reality. Whatever I say, many, many Caymanians will want to lend their active support to this project. They are as tired as I am of the disinformation being peddled by the opponents of the port and they look forward to the opportunity to register their wish to secure the future of our cruise tourism industry and get access to more and cheaper cargo. Therefore, whatever I say, there will be a sizeable yes vote on 19th. December. The secrecy of ballots will be maintained.

Finally, even if the premise were not false and the reasoning was not as flawed as it is, neither I nor anyone else in the government has any interest in victimizing any civil servant (or indeed anyone else) who votes no at the referendum. There is absolutely no evidence to the contrary. We heard time and again during the referendum campaign that any civil servants who signed the petition risked victimization but we have heard no complaints from anyone who has been so victimized. Nor will we. Civil servants are perfectly free to vote their conscience at the referendum without any fear of any action by any government that I lead.

Next, Mr. Speaker, I want to address an issue that is not found on the face of the Bill itself – that is the date chosen for the referendum. The House will be aware that earlier this month the government proposed 19th December as the referendum date.

This has been the subject of considerable conjecture since it was announced. That is despite the fact that I have said for some time that if the referendum petition reached the required threshold, the Government would then move to call the referendum as quickly as possible. This was in response to suggestions from the CPR that the Government would seek to avoid or delay the vote. Whatever date is chosen, some people may be away. That is why there are arrangements in place that allow every registered elector to cast their vote by other means if they cannot do so in person. Anyone who wants to vote can do so whatever date is chosen. There is no reason to delay.

The argument being made against this date is a somewhat strange one. Throughout the year or more it took to gather signatures for the referendum, we constantly heard that there was deep-seated opposition to this project and that voters were demanding to have their say. At every turn, campaigners expressed their confidence that if only they were given the opportunity then voters would come out in their droves to vote against the port and that they would do so in numbers sufficient to reach the 50%+1 threshold for the result to be binding.

Now the argument apparently goes that so weak is the level of opposition to the port that people will be put off voting simply because the vote is happening six days before Christmas. Which is it? If the “no” campaign is confident in its case, why do they believe that the date will make the difference? For, in reality, there is no impediment to voting whatever date is chosen. Anyone who is not able to vote in person can apply for a postal ballot as is always the case in Cayman.

If any vote is likely to be suppressed by the choice of the date it is the “yes” vote. I understand that (whatever I say) some voters who support the project may not bother to vote, especially if they are off-Island for example. They may feel that they can do so safely because of the 50%+1 threshold. I accept, therefore, that the final result is likely to understate the real level of support for the port development project.

While I am on the subject, the same applies to arguments about the sale of alcohol at licensed premises on the day of the vote. We have heard arguments that again this will suppress the “no” vote. Do our opponents have so little confidence in their supporters that they think that faced with a choice on the day they will decide to sit in a bar rather than turn out and vote down a government project that we are told they passionately believe will do harm to Cayman’s long term interests?

The reality is that many people and offices will already have booked Christmas parties and luncheons for that day and we do not want to disrupt those arrangements nor indeed stop tourists spending their money here in the busy pre-Christmas period. That is why the bars and restaurants will remain open. It is not some ploy to distract weak-willed “no” voters as is suggested. Our opponents really should have more confidence in Caymanians. If they truly believe the arguments put forward against the port, they will vote “no”. Either our opponents lack that confidence in their supporters or they lack confidence in their own case. I am tempted to think it is the latter and that all these arguments about the date are simply a smokescreen to excuse their eventual failure to get the numbers they need.

There is one other consequence of the choice of the date that has also been controversial. Section 5 of the Bill before this House in and of itself is uncontroversial. It simply states that those entitled to vote in the referendum will be those registered to vote on the date of the referendum. In this case that means those registered to vote on 19th December will be entitled to vote and in practice that in turn means that it will be those electors on the official register as at 1st October 2019.

The suggestion is, I believe, that the legislation should be changed to allow the 1 January register to be brought in two weeks early and to allow some 220 persons to vote who are on that revised register. Again, I find this extraordinary. Why should the rules be changed? The argument is that the government is trying to exclude these new voters because we fear they will vote “no”. If that were true, it must conversely mean that those opposed to the port are seeking to get the rules changed because it would advantage them. Once again, imagine if the government were to do that. Suppose we had been on a “sign up to vote” campaign to get supporters of the port to register and were now looking to bring forward the use of that revised register.

The fact is that on the date of any given election or referendum, we have to use the electoral register as at that date. If we do anything else that would constitute a form of gerrymandering. As is always the case, if you draw a line as at a date, some people find themselves excluded by that line. That is just the way it is.

The government has nothing to fear nor indeed anything to gain from having 200 or so more or fewer voters eligible to vote. We do not believe our opponents have sufficient support to reach the 50%+1 threshold with or without those new voters. We are not excluding them for some Machiavellian purpose. Rather they are not eligible under the rules that we consistently apply in the Cayman Islands. Seeking to change the law for the advantage of one side or another, be that real or perceived, would be the real anti-democratic thing to do.

Mr. Speaker, just as I come to believe that I have heard all the complaints from the opponents to the port there is yet another controversy that they are creating. The Bill, Mr. Speaker, calls for the ballot papers from all the electoral districts to be taken to a central location and “mixed together for the purpose of counting.” In other words Mr. Speaker the count of votes will be considered a national vote and not an electoral district vote.

The opponents, including some in the official opposition, cry foul because they say they will not know how their own constituencies voted. Mr. Speaker this is not some opinion poll being carried out for the convenience of the Member for Bodden Town West or George Town Central to provide data for later use or to help them in the next election campaign. This exercise is a referendum on a matter of national importance and it should be treated as such. The referendum is where a national decision will be made and what is important is the view of the country as whole – not individual electoral districts. In 2009 when we voted in our very first referendum as to whether to support the 2009 Constitution Order, that count was done in the same way – the ballots were mixed and a single count was done to determine the outcome. That was done efficiently even though the Elections Office was also carrying on the count for the general elections that were held the same day as the referendum. That was a national count for a matter of national importance.

This referendum, too, Mr. Speaker is one of national importance and will have a national count.

In short, Mr. Speaker, the government has put before the House a Bill that deals in a straight-forward way with the need to get on and meet the demands placed upon us by 25% of registered electors that we hold a referendum. The question to be used conforms to all good practice and is fair to both sides. It recognises that there is only one project that can reasonably be subject to a popular vote - and that is to move forward with building the country’s cruise and cargo port improvements together as has always been envisaged. We have chosen a date to expedite the speedy resolution of this referendum issue that has been ongoing for well over a year. And we have determined that the count should be a national count in line with the nature of the referendum itself. The rest of the arrangements under the Bill are consistent with the normal democratic arrangements of the Cayman Islands.

At this point, I would notify you, Mr. Speaker, and the rest of the House that there will be some tidying up amendments that we need to consider at Committee stage. These will be introduced in due course. However, we have heard opponents of the port arguing for more substantive amendments to the Bill. We may hear those arguments repeated from the Opposition benches today Mr. Speaker. Those arguments amount to an attempt to rewrite the question in what they believe is their own interest or to alter the normal arrangements for voting in Cayman, presumably for the same reason. We have those standing arrangements about how we conduct public votes for a reason and that is precisely to stop the kind of manipulation of who is or who is not eligible to vote that our opponents are proposing. This is Cayman’s first people-initiated referendum and it must be held in a fair and democratic manner. This Bill will achieve that objective.

However, it is not just for the sake of our democracy that this is important. The process and conduct of the referendum are significant concerns but it is the underlying issue to be decided that the nation should now focus upon.

On 19th December, Caymanians are being asked to decide on the future direction that this country will take. Opponents of the port project seek to portray this as a simple choice. At heart, their argument is that the development of a new cruise berthing facility and enhanced cargo provision will cause irreparable environmental damage. There are subsequent issues but this is the matter of principle at stake for the port’s opponents. I have said in this House before that this is a principled position, which I can understand and which I respect.

It is not though a position that any responsible government can take. Like most Caymanians, we in this government believe that in considering the port project, as in considering other forms of development, there is a balance to be struck between economic and environmental issues. There is no right answer to how to strike that balance, no formula to follow that yields an unambiguous solution. In the end, it is a matter of weighing the evidence and making a judgment.

In initiating this project, that is what the previous Administration I led did. We assembled a business case and carried out an environmental impact assessment in order to inform us but in the end it was our political judgment that the economic benefits were so significant that they outweighed the potential environmental impact of the project. What the referendum is doing is asking Caymanians now to repeat that process and to exercise their own judgment. Just like the government has done, voters need to weigh the evidence and make their decision.

Again, our opponents have tried to muddy the waters here. We hear repeated claims that either government is hiding things or that it is seeking to mislead people. The claim is that there is not enough information for people to make an informed decision.

In reality, there is more than enough information available. What I do accept is that some of it is relatively inaccessible and that it is spread across too many different documents. For that reason, the government will be producing an information booklet that will bring together into one place all the key information about this project. We will be making the booklets as widely available as we can in the run-up to the referendum.

To be clear, the booklet will be a presentation of the government’s case. I do not claim it will seek to present our opponents’ case for them and nor should it. This is a referendum about the delivery of one of this government’s key policy objectives. Explaining government policy is one of the responsibilities of government and promoting and defending a project we believe is necessary for the future wellbeing and prosperity of the Cayman Islands is something for which we make no apology.

However, setting out our case does not mean that we will in any way be untruthful. We are happy to set out the facts and to explain why we believe the project should move forward based on those facts.

The case for moving forward with building the cruise berthing and enhanced cargo facility is overwhelming. Consider first the economic case. Looking ahead, there is no status quo. Either Cayman’s cruise tourism industry continues to grow with the benefit of the new berthing facilities or we face the very real risk of its gradual but inexorable decline. Either we protect and grow the jobs and businesses of Caymanians who depend on cruise visitors or we face those jobs being lost and those businesses failing.

The approach we have adopted in moving forward the port project not only guarantees that the new berthing facilities get built. It guarantees that they get used, not just by the two major companies who are partners in the project but by other cruise lines as well. Put simply, without a throughput of passengers the Verdant Isle partners, including the two cruise lines, do not get their investment back. It is in their interests to bring their passengers to Cayman and to maximize the use of the berths throughout the week and in low season as well as high.

Without the new facilities, Cayman will increasingly be at the mercy of market forces that are likely to result in declining cruise visitor numbers. This will not happen overnight but the impact will be real and in the medium term will have a significant effect on Caymanian jobs and in Cayman’s wider economy.

In the last couple of years, Cayman has delivered strong positive performance in terms of cruise visitor arrivals. Our opponents suggested this demonstrated that our assumptions in the outline business case were flawed and our views on the likely decline of the industry were merely scaremongering. When it was recently reported in the press that cruise visitor numbers for the first 6 months of this year were down just over 5%, I did not hear anyone rushing to defend our opponents’ previous position. Worryingly, the numbers continue to decline. The first 6 months were buoyed by January 2019 being the best month on record. But if we look at the most recent 6 months for which data is available (March through August 2019), our cruise visitor numbers are down 12.3% compared to the same period last year.

This is in large part due to a correction in the market as other destinations that were hit by hurricanes have been able to welcome back cruise visitors. We must be thankful for that in many ways but the impact on Cayman is real. The future of the cruise industry is about bigger ships and more passengers. Those ships are already passing Cayman by. The impracticality of tendering passengers in those numbers particularly when they would have to queue for hours in the Cayman Sun to return to their ships means Cayman would no longer be attractive for many cruise itineraries.

As well as that long term benefit, the short term job creation associated with the construction of the new port will be significant. I said some months ago when I introduced the SPS in this House, that all the indications are of a slow-down in the global economy in the next year or so. The port construction jobs will help shield Cayman’s economy and Caymanian jobs from some of the potential impact of that slowdown. The jobs are real and are available to Caymanians as anyone who plans to visit the jobs fair scheduled for tomorrow by the Verdant Isle partners will be able to confirm.

The last economic benefit I want to highlight concerns the enhanced cargo facilities. We have to accept that our current port is too small, too cramped and too inefficient. It can barely meet the needs of the country now and if Cayman continues to prosper and grow, as this government certainly intends it should, we need better cargo handling facilities.

This project delivers Cayman’s much-needed cargo port enhancement and creates the capacity we need to see us through the next 15 years or so of sustained growth. There will be an increase of almost 30% in the useable cargo space. The current lack of space causes delays on the vessel operations and the availability of the containers for the retailers and other importers in Cayman. The addition of a 3rd small berth for smaller ships and barges hauling the likes of aggregate and cement will be a significant improvement, which will allow operations of another vessel that cannot be done at this time. Moving that berth out of the way of container operations allows for the simultaneous operations of container vessel and bulk cargo. The improvements will mean that the port can use new specialist cargo cranes rather than the inefficient converted construction cranes it uses now. Taken together, these improvements will improve the efficiency of cargo handling at the port and will help to reduce shipping costs for importers.

The cargo improvements, if done on their own, would cost tens of millions of dollars. If the Port Authority had to finance the costs themselves, the only way it could do it would be to increase docking and handling charges, which in turn would increase the costs of imported goods. There is no viable ‘do nothing strategy’ for the cargo port. The throughput demand that we put upon it has outgrown the ability of the port to meet our needs. That position will only worsen as the port ages further and our demand for imported goods continues to increase. Enhancements to the cargo port are badly needed. Our choice is to move forward with the overall redevelopment project funded by Verdant Isle or to try to fund and build stand-alone cargo handling improvements. If we move forward with the planned project, we can achieve efficiencies to help to reduce import costs but if we try to finance a stand-alone cargo project then inevitably the costs will be added to the prices of imported goods. The cost of living in Cayman will go up.

If Central Government is asked to fund a stand-alone cargo dock then it would be by taking money from some other capital project. Which one should we take it from Mr. Speaker – Our school plant improvements? The John Gray High School? The just started mental health facility? Our road works programme? Which project should we sacrifice or slowdown to be able to make a start at paying for a larger cargo port facility? No, Mr. Speaker, that is not really a solution my Government or the public would accept. Neither would we entertain any new borrowing for this. The arrangement for additional cargo space coupled with cruise berthing that is funded by Verdant Isle partners and repaid from cruise ship passenger fees is an excellent arrangement, Mr. Speaker.

I have summarized the economic benefits of this project and in due course I will turn my attention to the costs.

But before I do that I wll address the environmental impact of the projects. I will start with this: Despite the oft-repeated claims of opponents of the port development, there is no impact on Seven Mile Beach.

All of the scientific evidence compiled for the environmental impact assessment demonstrates that fact quite clearly. Put simply, sand on Seven Mile Beach comes from the northwest and that flow is undisturbed and will be undisturbed by the redeveloped port infrastructure. After exhaustive scientific modeling of the tides, wind, wave climate and associated sediment transportation processes that operate along that whole coastal stretch, the conclusion in the Environmental Statement produced by Baird & Associates in 2015 is clear and inescapable:

Quote - “There is no apparent sediment transport linkage between George Town Harbour and Seven Mile Beach; therefore, the proposed project is not expected to have any impact on Seven Mile Beach. Fluctuations in the beach width will continue but the proposed project will not cause any changes in the erosion or deposition patterns along Seven Mile Beach.” End quote

Opponents of the project are usually keen to talk about the conclusions of the Environmental Impact Assessment but for some reason, this one, perhaps one of the most important in the whole study, is the one they chose to ignore. Actually, it is not just a matter of ignoring this evidence, they seek to deny the science through a mix of anecdote and assertion. I say to the country, do not be misled. The EIA is available, go and look at the evidence for yourself. You will see the rigour of the model, which allows testing of every combination of weather and sea conditions that has hit Cayman for decades. You will see the clarity of the report’s conclusions as I have just quoted them. Please ask those who assert that Seven Mile Beach will somehow get denuded of sand because of the port development to show you the detailed science behind that claim. My only advice to you is not to hold your breath while you wait for them to produce any relevant scientific data to support their wild assertions.

But Mr. Speaker, whilst the opponents of the project do not seem willing to accept the science that indicates that Seven Mile Beach will be safe, I am pleased to advise this Honourable House that, significantly, the Environmental Assessment Board has accepted the findings and endorsed the scientific methodology followed by Baird & Associates. The Environmental Assessment Board noted in its report on Baird’s Environmental Statement that it found the data collection and results outlined by Baird to be robust given the timeline for completion of the EIA. In referencing Seven Mile Beach specifically, the Environmental Assessment Board report states that:

Quote “we note the conclusions in the Environmental Statement that no large scale changes to the prevailing sediment transport patterns will arise as a result of the project. The EAB is satisfied that the results of the sediment transport modeling confirm/verify previously understood mechanisms for sediment transport regimes between George Town Harbour and Seven Mile Beach.” End quote

This information has been said many times Mr. Speaker but has been deliberately ignored. I hope that after today we will no longer have people and organisations who should know better continuing the narrative that Seven Mile Beach is at risk by this project.

Leaving aside the more fanciful claims; however, the Government does accept that there will be important environmental impacts to the close-by marine environment. Most significant is any potential degradation that may be caused by dredging to the coral in the area of the redeveloped port.

The Environmental Impact Assessment, which was completed in 2015, estimated the extent of the potential impact but it also considered how that impact might be mitigated. Before I talk about mitigation; however, I want to emphasise the work that has gone on since then to reduce the likely environmental impact. In response to concerns in our community, raised after the publication of the EIA, I gave a commitment that as we progressed this much-needed project, the government would take the opportunity to find ways to reduce the potential damage. The procurement approach that we have taken means that the contractor is responsible for designing the new facilities so we challenged the bidders to come back to us with designs that fulfilled the government’s pledge to the country.

I am delighted that they have been able to do so. The designs were made public a couple of weeks ago so people can see for themselves but the headline changes from the original proposals are that the cruise berths themselves have been completely redesigned and the cargo enhancements have been scaled back. Recognising the concerns over dredging in particular, the redesign moves the piers to deeper water. As a consequence, the footprint of the new port design requires 30% less dredging than the original design and eliminates completely the need for any dredging in Hog Sty Bay. In fact Mr. Speaker, despite stated concerns about the impact of the project on Eden Rock, I am advised that the reefs in that location are approximately two football fields away from the marine work by the dock and are extremely unlikely to be impacted at all by the dredging.

Even with the significant improvements in the design, there will be areas where coral will be impacted by the new facilities. Here is the role for mitigation. It is not possible to move the dredging so that it avoids the coral completely but it is possible to move coral so that it can thrive in areas well away from the working of the new port.

Perhaps surprisingly, this too has become an area of controversy in the project. Coral has been impacted in Cayman before, many times, not least by damage caused by cruise ship anchors. Mr. Speaker, let me remind the House of Cayman’s recent experience. There have been two large-scale coral re-attachment cases in the recent past in West Bay and Eden Rock. Shipping incidents dislodged and fractured large sections of the limestone reef and damaged thousands of corals at both sites. Polaris, Applied Sciences Inc., the proposed Verdant Isle Coral Relocation Partner, restored both of these sites in 2016 and 2017. Coral fragments that are broken and disturbed by vessel anchors and ship hulls should arguably have a lower survival rate than those removed more carefully as will be case with the port project yet monitoring studies have reported 89% survival of tagged specimens in the West Bay site two years following the restoration compared to 93% of unaffected coral colonies. Rather than joining with us to ensure that environmental mitigation works effectively, our opponents seem now just to want to decry those mitigation efforts and tell us that they will not be successful. In my view, exactly the same coral species, in the same vicinity, relocated by the same teams provides the best evidence of likelihood of success for this project.

This is not to underestimate the challenges involved in carrying out a coral relocation project at the scale envisaged in George Town Harbour. It is clear that the proposed coral relocation will never completely mitigate the ecological impacts of the port improvements. However, the experiences both locally and elsewhere can help us as we meet those challenges, drawing on the experience of what has worked, and what has failed, here in Cayman and around the world. There is every reason, as I have said, to be confident that the same experts who have been so successful in relocating coral in Cayman previously will be able to develop and implement an equally successful coral relocation plan for this project. We should be confident that they can achieve high survival rates and that they will help us to achieve the plan’s aim of no net loss of biodiversity, which is in keeping with the overall goal stated in the Cayman Islands National Biodiversity Action Plan, 2009. Indeed the project will include a coral nursery as part of its coral recovery plan so as to grow and transplant coral onto local reefs that are being degraded.

The last issue of substance for the decision on whether the country should move forward with building new cruise berthing and enhanced cargo facilities is the question of financing and affordability.

The upfront costs of building the new cruise berths and the enhanced cargo facilities amount to CI$200M. All of that will be paid for by Verdant Isle, the successful bidder. There will be no government cash contribution, no government borrowing or bonds and no government guarantees. The entire cost and all the risk sits with Verdant Isle.

They make their money back from the per passenger tax that is levied on all cruise ships calling at Grand Cayman. Here comes the first piece of misleading information about the finances put out by our opponents. They calculate that the total income that Verdant Isle will receive over their 25-year tenure will be $450M. I will not quibble with that calculation so let’s just accept it. They then express their indignation that a private sector entity will be receiving $450M in income when the build cost is only $200M. The $250M extra sounds like a massive profit flowing into the hands of the business partners in the consortium.

The first issue with it is that our opponents are conveniently forgetting that the contract also requires Verdant Isle to maintain the new facilities or the next 25 years. It is estimated that the maintenance costs are likely to total around CI$75M in that period. That reduces the surplus to $175M. That still sounds like an awful lot of profit to make though, doesn’t it? Well, no actually. $175M over 25 years equates to $7M per year. Against an up-front capital investment of $200M, that equates to an annual return of just 3.5% - again this assumes that the $450M is correct. If the partners in Verdant Isle were just looking to make money on an investment they would do better just lending their money out on the markets – they would get a better return.

Do not forget as well that the CI$200M projected cost includes the vital cargo port enhancements.

The other issue raised by our opponents is that, they claim, the Cayman people will be paying for the new facilities. The basis for that claim is as follows. The amount of the passenger tax that Verdant Isle will receive is mostly a replacement for the tender fees that the cruise companies will no longer be paying. However, in order to make the overall financial model work, the government is reducing the amount per passenger it receives by a small amount. That is absolutely true. The amount that was discussed previously by the Ministry was US$2.32 per passenger. However, this amount was based on the original design option that would cost some CI$229M. The option that we have chosen Mr. Speaker is one that will cost just under CI$200M – thus we do expect that the final per passenger cost, once the final contract numbers are agreed, should be less than US$2.32 per passenger.

On the basis of those facts our opponents have come to the conclusion that Cayman is, therefore, losing out financially. That is totally and factually incorrect.

What we are giving up is income that we would not have unless the project goes ahead. To understand this, remember the point I made at the very beginning. If we build the new cruise berths the number of passengers goes up. If we do not build the new berths the number of visitors to these Islands will decline. Put very simply, the Government’s total income is greater if the project goes ahead. It will be greater than we get now and much greater than if we do not build the new berths. The reason is that we are getting a slightly lower amount per passenger but the increased number of passengers means our total income goes up. Ask any Caymanian whether they would rather sell 20 mangoes for $6 each or have 25 mangoes that they can sell for $5 each. For the benefit of Members opposite, 20 mangos at $6 each yield an income of $120, while 25 mangoes at $5each yield $125. Would any Caymanian think that in the latter case they were better off because their total income was higher or that they were losing out by giving up one dollar per mango? If our opponents think that 20 mangoes for $6 each is the better option I invite them to come and buy their produce from my farm.

I have heard it said that the financing sounds too good to be true. Someone else builds Cayman the new cruise berths and enhanced cargo facilities it needs. They are willing to fund the project entirely themselves with no contribution or guarantee from the government. The total income to government from passenger tax goes up. Throughout the build and operation of the new facilities, the port stays the property of the Cayman people and it will continue to be operated by the Port Authority. There has to be a catch, right?

Wrong. There is no catch. This has been achieved because my government has been willing to go to the market positively and confidently, negotiating from strength in order to secure the kind of solution that has never been seen in the cruise industry before. Bidders were willing to take part in the procurement on those terms because of the strength of the Cayman offer to cruise visitors. Cruise passengers enjoy coming to Cayman and they want to continue to do so. The only barrier is the logistical one caused by the lack of berthing facilities. The model is attractive to the two cruise companies that anchor the consortium not because they will make money from the port itself but because keeping Cayman on their schedules helps them to sell cruises. That is where they make their money out of this.

Mr. Speaker, I confess that in some ways this referendum can be seen to be an unnecessary distraction. However, as I said earlier, I respect the work that has gone into gathering the necessary signatures and a referendum we will have.

In some ways though, this is a fitting debate for our country to be having. As a people, we need to decide the direction that our Islands will take in the decades to come. In doing so, let us reflect on what our people have achieved over the sixty years since we first gained a measure of self-government with the granting of our first written Constitution.

No doubt there were people then saying that Cayman should remain ‘the Islands that time forgot’. But there were others, Mr. Speaker, who were not content to leave things the way they were. People who wanted to improve the quality of life for Caymanians. They were willing to put in place the legal frameworks that brought the first banking and finance businesses to Cayman. They were willing to balance some loss of environmental amenity to build our airport and then, yes, our existing cargo port; to welcome hotel developers; and to invest in the necessary infrastructure to allow these Islands to grow.

Alongside those pioneers, some now recognized as our National Heroes, the Caymanian spirit of enterprise and entrepreneurship meant our people founded and grew the businesses that could take advantage of the new economic opportunities that presented themselves. Mr. Speaker, I believe that spirit is still alive and thriving in these Islands. Our people are not waiting for the government to come up with answers to questions about where tourists will go and what will they do. The government will play our part, but Caymanians will exploit the opportunities and create the businesses that answer those questions for themselves.

This is what occurred after the wharf on the ironshore was converted into a modern cargo dock facility in 1977. A cargo dock that has served us well and has been expanded over the years, but that is again in need of expansion.

But Mr. Speaker, as you well know the George Town Port Project that was opened in 1977 was controversial in its time. There were those who, like some opponents today, lacked vision and did not appreciate the need to modernise and improve our infrastructure.

Some of that history Mr. Speaker was captured in a supplement published by the Nor’wester Magazine on July 16th, 1977, to celebrate the completion of the George Town Port Project. I ask the indulgence of the House Mr. Speaker to lay a copy of this supplement on the table of the House and to recite a few words from it that mention the comments made by Mr. Berkley Bush, who was the ExCo member responsible for building the port, when he spoke at the opening:

Quoting from the article - “In his speech Mr. Bush outlined the history leading up to the construction of the port facility. Although he had been a central figure with his drive, determination, and enthusiasm in getting the port project started, he summed up the part he played by saying ‘There was a job to be done and someone had to do it and I just happened to be that man.’

The ceremony also gave Mr. Bush an obviously welcome opportunity to answer his critics who had carped about the facility and its positioning for many years. With obvious relish he pointed out to those who had said it was utter stupidity to build in George Town because of nor’westers, that the dock had survived two seasons of nor’westers while under construction.

To those who had pointed out that the Island had done alright with just the ironshore during the boom period, and why therefore was a dock facility needed, he wondered where the country would end up if such prophets of doom were in the driver’s seat.

To those who had said that he had lost his seat in the Legislative Assembly because of his involvement with the dock and insistence that it be in George Town, he replied in ringing tones that he would rather have the dock facility, and have it in George Town, than occupy every seat in the Legislative Assembly, representing people who did not want the port.” - End quote

Mr. Speaker, I want to mention another recorded statement from that supplement – that of Captain Charles Kirkconnell who spoke after Mr. Berkley:

Quoting from the article - “Captain Charles also pointed out that a gateway to larger and more up-to-date cargo ships had been opened and would link the Islands with international terminals. This was bound to result in savings to the consumer… The manner in which cargo was handled on the old wharf had caused damage and losses to the imported goods, which naturally forced prices to rise.” - End quote

Mr. Speaker, I thank God and we all should that we had representatives like Berkley Bush and Charles Kirkconnell who had vision and understood the need and benefit of vital infrastructure projects – in this case a modern port facility that has benefitted the country and our people hugely over the past 42 years. I do believe Mr. Speaker that 40 years hence those who occupy these hallowed halls will recognise that the building of this cruise berthing and enhanced cargo port was similarly significant for the future development and success of our Islands and our people. And Mr. Speaker, they may undoubtedly state how glad they are that the prophets of doom had failed to stop the project by way of this referendum.

The question on the ballot paper in this referendum is about cruise berthing and enhanced cargo facilities. The question for the country is whether we still have the confidence in ourselves and in our future to grasp the opportunities before us - the opportunities to start new businesses; the opportunities to improve still further our world-class Caymankind cruise tourism offer; and, yes, the opportunity to show we can deliver a world-leading coral relocation programme.

I believe in a strong and prosperous future for Cayman. I believe in opening the door to economic opportunity - not slamming the door on the jobs of the hundreds of Caymanians whose livelihoods depend on cruise visitors. Finally, I believe, Mr. Speaker, that the majority of Caymanians believe as I do. The referendum gives them the chance to show their confidence in themselves and in a prosperous future.

The choice facing the people of the Cayman Islands on 19th December is a clear one. On the one hand, we can choose to move forward with building our new cruise berthing and enhanced cargo port facilities. If we do so, we guarantee that cruise ships will continue to bring their visitors to Grand Cayman and in so doing we safeguard existing jobs and create more employment and business opportunities for Caymanians. The enhanced cargo facilities will mean that the port can handle bigger ships and more cargo more efficiently and this helps drive down the costs of all the goods we import. This redevelopment of our tired and inefficient cargo port can only be funded because it is being linked with our new cruise berths. Cayman can choose to move forward with building our new cruise berthing and enhanced cargo port facilities. We can and we should choose prosperity.

On the other hand, we could turn our backs on the redevelopment of our port. As cruise ships grow in size, they will increasingly pass by Cayman on their way to other destinations that have the facilities needed to cope with their passengers. Visitor numbers in Cayman will fall. Caymanians will lose their jobs and their businesses will fail. We could try to make do with cargo facilities that are already too small to meet our current needs, let alone meet the needs of a growing population. We could choose decline.

The deal the Government has negotiated with Verdant Isle partners ensures that no government funding is required to build the dock but the facilities remain in our ownership. Increased visitor numbers mean total revenue to government increases so we can afford to continue funding other things like schools and road improvements. There is no financial risk to Cayman, its government or its people.

The government has responded to people’s environmental concerns and the redesign of the port development has significantly reduced the environmental impact of the project. There is no dredging in Hog Sty Bay and no risk to Seven Mile Beach. There will be damage to existing marine environments but millions of dollars will be invested to relocate coral and we aim to achieve no net loss of biodiversity. The Government has done all it can to safeguard Cayman’s economic future while minimizing any environmental impact from Cayman’s port redevelopment. Prosperity or decline? This government chooses prosperity for this and future generations of Caymanians. We must get on and move forward with building the cruise berthing and enhanced cargo facilities that help to secure that future prosperity.

I ask all members of this Honourable House to vote aye to this referendum bill, and that those Caymanians who go out to the polls on referendum day to vote a resounding Yes to the question, “Should the Cayman Islands continue to move forward with building the cruise berthing and enhanced cargo port facility?”

Thank you Mr. Speaker.

Oct 27, 2017

Budget Policy Statement 2017

Oct 27, 2017

Budget Policy Statement 2017

Mr. Speaker, as we meet today in this Honourable House I cannot help but be a bit nostalgic. Today we are making history with the Cayman Islands’ first two-year budget and this new Government of National Unity’s first budget. And H.E. the Governor Helen Marjorie Kilpatrick, CB, who delivered her first Throne Speech at the start of the last administration, has just delivered her final Throne Speech at the start of this new administration. Time marches on. Time marches on.

I want to thank the Governor for her hard work these past 4 years, for her genuine love of these Islands and our people, for her approach to governance and her respect for the constitutional division of responsibilities between the Office of the Governor and the Office of the Premier. She has been a most welcome breath of fresh air. It has indeed been a pleasure and an education working with her and I sincerely appreciate the support that both my previous and current administrations have received from her and her office. I will not, at this point, yet bid her farewell. There will be time enough for goodbyes when she is about to depart some five months hence.

Mr. Speaker, Seneca, the Roman philosopher and politician, is reported to have said that “Every new beginning comes from some other beginning’s end”. Like us, Seneca understood that the political cycle continues from one administration to the next. And as we begin this new cycle, we in this new administration intend to build on and enhance the good work that has gone before us.

In short, Mister Speaker, the last Progressives-led Government has given the current administration an excellent platform both in terms of strong, sustainable economic growth and the return to fiscal stability. We will use that platform to tackle the significant issues facing this country.

So, in generating the plans that this budget will put into action, we have clearly built upon the work of the last, Progressives-led Government. I make no apology for that Mr. Speaker. I am proud to have led that Government and I am proud of what it achieved. You will see that continuity, for example, in the provision this budget makes to implement the integrated solid waste management strategy. You will also see that continuity also in the plans for the new mental health facility, which has progressed to the design stage.

Whilst that continuity is important, this is also a government with new ideas, generated from all those within the coalition. You will see the results of our collaborative efforts in our approach to extending support for small and micro businesses. You will also see that collaboration in our willingness to tackle the need for reform in our healthcare markets to ensure better outcomes for our people and a sustainable future for CINICO.

This budget also provides the resources needed to make the vital improvements to our nation’s infrastructure. We will complete the improvements at Owen Roberts International Airport and continue to progress the work on the George Town cruise and cargo port project to support our tourism industry. We will continue to invest in the country’s road network and meet the need to update infrastructure on the Sister Islands. We will continue the construction of new schools and other buildings to enhance public services. We will do all that – as did the last Administration - without resorting to new borrowing and without introducing new revenue measures. In short Mr. Speaker, this Government has no intention of adding more debt to future generations, or burdening families and businesses with more fees and taxes.

Today, as we have done these past four years, we are again presenting a responsible but ambitious budget that not only meets the requirements of the Public Management and Finance Law, but also advances the Government’s agenda, which I set out in my Strategic Policy Statement this past August. We are presenting a budget that increases economic opportunities for Caymanians and one that drives social improvement in our communities.

This is a Government with ambition. We are ambitious for our country. We are ambitious for our people. And that is why in this budget we are investing in and prioritizing improvements to the range of services provided to our people that I set out when I introduced the Strategic Policy Statement to this House in August.I said then, Mr. Speaker, that this Administration would prioritise education. This budget directs resources to significantly raise our game on technical and vocational education and training and continuing to drive up academic standards in our schools.

I also said then, Mr. Speaker, that we would respond to the rising concern in our community over crime. This budget will put more police officers on patrol in our communities – 75 more over the next three years - helping to deter and detect crime. It also provides funding for the long term prevention of crime by investing in at-risk youth diversion projects and measures to cut reoffending.

I said as well, Mr. Speaker, that this would be a Government that looks after the most vulnerable in our society. This budget provides for an increase in the ex-gratia poor relief payments made to Caymanians in need and Seamen and Veterans by $100 per month from $550 to $650 in 2018 and from $650 to $750 in 2019. It also makes similar provision for civil service pensioners earning less than those receiving poor relief.

And as I said earlier, this budget secures the funding for a long term treatment facility for those in our society suffering from mental health problems.

We believe, though, that our ambition must necessarily be tempered by the ability of our revenue to fund the programmes and projects we wish to achieve. Therefore, there will be no deviation from the path of fiscal responsibility to which my previous Administration returned these Islands. As a result, the budget before the House recognises that choices need to be made in terms of what we can afford and it therefore targets resources where they can make the most difference.

As I said just now, Mr. Speaker, there will be no new borrowing and this budget imposes no new revenue raising measures on the people of these Islands. Instead, we will continue to pay down debt and deliver operational budget surpluses that help to fund our capital investment plans and provide for contingency against future economic shocks.

That path of fiscal responsibility is crucial in giving businesses the confidence to invest in Cayman. That continued investment is what stimulates the strong and sustainable economic growth we currently enjoy.

This Government will ensure that Caymanians benefit from that growth. This budget reflects our commitment to full employment through the expansion of the Ready2Work.Ky programme and to long term opportunities created through better education and skills among the Caymanian workforce.

Those benefits to Caymanians will be delivered by supporting our people and giving them the opportunities they need. These benefits will not be delivered by needlessly penalising those from overseas who want to come to work here alongside us and help to shore up our economic strength. We are committed to making sure that our immigration and work permit systems are efficient, fair and transparent. All those with a contribution to make to our economy and to our society are welcome here; but skilled, qualified Caymanians must be provided that same opportunity.

We realized early on in the past Administration that some Caymanians who have difficulty obtaining and keeping employment need help to access the labour market. Earlier on I mentioned the Ready2work.Ky programme. This was a successful partnership between business and government aimed at supporting such individuals into work. During the pilot of the Ready2Work.Ky programme, assistance was provided to 137 Caymanians. When the pilot programme ended, 89 individuals had completed the programme; 64 of whom obtained employment and 25 of whom were engaged in ongoing training, development and recruitment activities.

Mr. Speaker, over this budget term, Government will expand the Ready2Work.Ky jobs programme to make Caymanians who need extra help work ready and successful in the workplace. This is an important initiative and one that will be needed for some time to come. We will also continue the National Community Enhancement Project – the annual Christmas clean up - to provide employment during the Christmas season for those in need of work.

But, Mr. Speaker, as I said when speaking to the SPS, work programmes are a necessity in the short to medium term – but they are not long-term solutions. In the longer view, we must do a better job of ensuring that Caymanians enter the workforce with the necessary level of education and skills needed in an increasingly globally competitive marketplace. And by “we” I refer to the collective we – government, businesses and citizens.

Mr. Speaker, while this Government will do all it can to help our people enter and remain in the labour market, we know we have to focus on developing our people for gainful employment early on; while they are still in our school system.

Government has a categorical responsibility to support our young people as they strive to gain knowledge and develop into productive citizens. The 2016 Education Law, passed by the last Administration, was the most important structural reform of our education system in over three decades. Linked to the work we did to understand the baseline needs of schools, it has provided a comprehensive platform to drive improvement in our school system.

So in this budget we have provided an additional $9.6M to cover special education; the enhancement of science, literacy and math; as well as skills upgrading for 400 teachers and assistants; and for scholarships and youth programmes and additional teachers.

To this end, several new education posts have been added in the 2018-2019 budget, including special needs specialists, teaching support staff, leadership positions, reception, primary and high school teachers as well as for science, technology, engineering and mathematics.

In addition, we have included some $36M over two years for computer software and equipment and needed improvements at Bodden Town, Red Bay, Savannah, and Cayman Brac primary schools, as well as the University College of the Cayman Islands. This also includes funding to start the initial planning work for a new West Bay Primary School as well as completion of the new John Gray High School.

Mr. Speaker, I want to speak directly to parents and young people now. It is important to understand that there are many good, well-paying jobs available in the vocational trades in this country. As an example, as of June 2017 there were about 2,800 work permits held by people in vocational trades such as air conditioning technicians, dental and lab technicians, personal assistants and secretaries. Another 3,400 in fields like auto mechanics, auto body repairs, electricians, carpenters, painters, masons and plumbers. And there are many jobs in hospitality and health services.

I am pleased to report that the Hospitality and Nursing schools started under the last Administration continue to pay dividends with 28 graduated from hospitality studies and 10 in nursing studies this past year.

We will improve the opportunities for youngsters to be exposed to Trade and Vocational Education Training and, where appropriate, encourage them to consider further TVET training locally or overseas. This encouragement should come from home as well as from school. So we will ensure that schools’ guidance counsellors also point youngsters to the kind of vocational careers where TVET provides the right training ground. Training and accomplishment in a trade can bring with it a good livelihood as well as employment security for a lifetime.

Contrary to what many believe and say, Mr. Speaker, there are significant numbers of TVET programmes available through the public and private sectors, including a fledgling but promising programme run by Government’s Public Works Department.

In July this year, after a one-year apprenticeship, five young Caymanian students completed a pilot programme when they were assessed for internationally recognized City and Guilds certifications at PWD and achieved either foundation or proficiency level certifications. This is a significant milestone as it is the first time that this level of construction vocational certification has been delivered in the Cayman Islands.

I am happy to report that the 2017-2018 PWD apprenticeship programme commenced this month, offering both level 1 and level 2 City and Guilds training. Fifteen apprentices are enrolled in the programme. Three of the level 2 apprentices are graduates of the pilot programme. And in September 2018 we are expecting approximately 30 apprentices to be enrolled in level 1, 2 and 3 programmes. It is intended that PWD become an accredited training centre for such internationally recognised construction vocational training within the next 1 to 2 years. This will not only allow PWD to ensure that it has trained individuals available to work for Government, but facilities will also be used to train, qualify and give experience to youngsters so that they can find employment in the private sector.

This is just one programme with so much potential, but there are others. We will develop a coherent strategy to better use these programmes, ensuring that we work with the private sector to determine their workforce needs regarding trained employees.

But, Mr. Speaker, we must ensure that quality available programmes are fully used and supported to avoid unnecessary spending and duplication of efforts. As I said during the Strategic Policy Statement, no one – particularly those seated in the Opposition – should doubt the priority we in this Government give to improving education, including TVET. And to demonstrate it, I again repeat our commitment to a clear target of at least 75 per cent of high school graduates to move on to post-secondary education or training by the end of this Administration’s term. This is a challenge we are doggedly determined to meet.

I said in the Strategic Policy Statement that this would be a Government that looks after the most vulnerable in our society. This budget provides for an increase in the ex-gratia poor relief payments made to Caymanians in need and to Seamen and Veterans by $100 in each of the next two years, going from the current $550 per month to $650 and then $750. Likewise, civil service pensioners who served our country for many years but who are now retired with a pension that is less than what is provided for poor relief will received a combined sum (pension and ex gratia payment) of $650 per month from next January. Though this change to civil service pensions may require specific legislative amendments, which will need to be done early next year, I expect payments to begin by the end of March 2018. However, we will ensure that payment is retroactive to January so the recipients are not prejudiced. Further, the monthly payment will increase to $750 in January 2019.

Mr. Speaker, we set aside each October as Older Persons Month. An Older Persons law was approved in March this year, and commenced in July, to help ensure that older persons are able to freely access and participate in all aspects of society. Cabinet has just appointed a Council of Older Persons that will champion and monitor the promotion and development of programmes, projects and legislative measures as well as monitor and evaluate the implementation of the action plans for the Older Persons’ Policy. This is a significant achievement and the appointment of the Council is a significant milestone.

This budget also secures the funding for a long term treatment facility for those in our society suffering from mental health problems.Under the previous Progressives-led Administration work began on a new long-term mental health facility. This past September this Government signed a contract for the design of a long-term home in East End for the treatment of those with mental health problems.

Mr. Speaker, our own head of the Mental Health Commission estimates that 4,000 people in the Cayman Islands suffer with some degree of mental illness. While not all will seek or indeed need treatment at the facility, the home will enable us to treat our people here, closer to their families and communities, rather than sending them to the United States or Jamaica.

Going forward Mr. Speaker, we expect to begin the tendering process for the construction of the facility in June 2018 and open the six initial cottages for the treatment of patients and a central administration building in early 2019. Other cottages will follow, as needed.

Just as we look after the most vulnerable in our society, we are also duty bound to take care of the businesses that help to strengthen our economy.

Mr. Speaker, I am delighted that in this budget we have been able to continue the major stimulus policies introduced in the previous Administration.

These include reduced import duties, lower business licensing fees, development concessions and support to small business as well as initiatives to improve diversification of our economy and employment of our people. Those policies were critical in supporting economic growth in our country at a time when our economy remained fragile. Now, as economic strength is restored, we have resisted any temptation to reverse those policies in order to continue our support for private sector growth.

A thriving small and micro business sector makes a vital contribution to our economy, ensuring that it remains vibrant, dynamic and robust. On this basis, government remains committed to doing all that we can to positively support this sector. We will continue the work of the last Administration by enhancing the support and assistance available to entrepreneurs who desire to establish or grow their operations. Initiatives like these have helped Caymanians start more than 1,000 new, small businesses over the last four years, which in turn have created more jobs for our people. The resultant economic growth has also renewed investor confidence, leading to more development, more opportunities and further expansion of large and small businesses alike.

Government will build on that success and continue the positive momentum. Ambitious, entrepreneurial Caymanians need encouragement, not the dead weight of government bureaucracy holding them back. Therefore, we have pledged to abolish at least 25 per cent of the regulations that hinder small businesses. We will also introduce a tiered fee structure so that charges will be levied more equitably across business entities based on their size.

Government will continue to meet with the Small Business Association and the Chamber of Commerce on a regular basis to ensure we are working together to benefit the Caymanian economy and the businesses that drive our success. We will also look at ways to help small firms gain access to funding by working with the Cayman Islands Development Bank, as well as with other private funding institutions.

Just a couple of weeks ago we held a Small Business Development Centre workshop to identify some of the strategies and direction that we as a country, and a Government, would like to pursue in promoting this vital sector.

Promoting business growth and development is key to Cayman’s prosperity.

I am happy to report that from 1 January, 2017, to October this year our Department of Planning has approved 1,013 projects at an estimated value of $688M. That is a sharp increase from the same period last year when 760 projects had planning approval at an estimated value of $342M. That reflects the increased confidence investors have as a result of the economic performance and fiscal stability that now characterise these Islands.

Just as we help facilitate business growth, and thereby jobs for our people, we want to ensure that Caymanians who are skilled, qualified and want to work are not consistently disadvantaged in the labour market.

To this end, the Ministry of Human Resources and Immigration is leading the establishment of a National Human Resources Department.

The National HR Department will encompass the main administrative functions related to immigration – processing applications for the grant of Work Permits, Permanent Residency, and Caymanian Status. The department will continue to work in collaboration with the various immigration boards to efficiently optimize workflows. The department will also be responsible for monitoring changes within our dynamic labour market to give Government the strategic oversight and planning of future human resource requirements. This will build capacity and capability among Caymanians seeking to more ably compete for employment opportunities.

It is important to note, though, the establishment of the National HR Department, however, will not merely be an exercise of merging functional aspects of the National Workforce Development Agency and the Department of Immigration. Based on extensive stakeholder consultation, it is clear that a radical shift is necessary in order to modernise the strategies, services, and processes if we are to build effective workforce readiness skills in conjunction with an efficient, fair, and transparent work permit and permanent residency regime.

Over the next two years, the Ministry of Human Resources and Immigration will roll out a programme of modernisation that will lead to legislative reform; introduction of technology to automate business processes; workforce development programmes; and put in place an employer accreditation programme.

The further development of the National Jobs Clearing House will improve the transparency of the work permits process and ultimately make things easier for business and job-seekers alike, as all available jobs in the Cayman Islands will be required to be listed there. Work on this was started by the last Administration and will be completed next year.

Mr. Speaker, employment of Caymanians is a focus of this Administration just as it was of the last. This includes seeking avenues for employing retired Caymanians who are in good health and still wish to maintain employment. This is in part why my previous administration amended the law to allow persons in the public and private sectors to work and be entitled to pension beyond the age of 60. And this is why we also internally sought a way to allow retired persons to serve as security personnel in the Government Administration Building and other government buildings. The challenge we found was that not only were there existing contracts in play to provide these services, but contracts are required by Government procurement rules to be awarded with “value for money” being a major guiding principle. No one can doubt that this is a vital principle in utilising public funds.

However, businesses tendering to provide security services will likely do so by paying minimum wage so as to keep the bid amount as low as possible. These businesses would be challenged to find Caymanians willing to work at minimum wage and often during unsocial hours. One solution that this new Administration recently utilised in the bidding process is to allow extra points to be awarded for companies bidding for government contracts that can demonstrate employing a high number of Caymanians. Yes, Government must get value for money, but Government should also seek as much as possible that companies bidding to provide services to Government employ Caymanians wherever possible. As we have started to do and intend to continue.

The concept of fairness to Caymanians seeking jobs also comes into play when we tackle the issue of competition in the market place and the costs of goods and services. Ours are but three small Islands, Mr. Speaker. We can be prey to market failure or even to unscrupulous business practice if we do not ensure fair competition and effective regulation. That is why the previous Administration passed and implemented the Utility Regulation and Competition Law last year, which prompted the creation of the regulation office in January this year. It is an amalgamation of the former Information and Technology Authority, the Electricity Regulatory Authority and the Petroleum Inspectorate.

One of the duties of this office is consumer protection, including fair pricing in the fuel sector. And so one of the main objectives of the Utility Regulation and Competition Office (Off Reg) will be to quickly complete the work needed to ensure fair pricing and competitiveness at the gas pump, after which focus will be placed on the wider fuel sector. Though there has been some delay, a lot of work has been done toward improved regulation of the fuel sector. I have been advised that by and large, the companies within sectors, particularly the main oil companies, are now complying with legislation and providing critical information to OffReg to carry on their work. Pending the establishment of market rules, there has been general agreement between the fuel wholesalers and Government that prior to increasing prices, there will be discussions and review of the necessity of the increase to satisfy OffReg. I am pleased to say that because of this discussion and sometimes pushback by OffReg that there have been times recently when price increases were deferred or foregone. To aid the creation of market rules, OffReg will commence a robust and comprehensive analysis and assessment of the market, including benchmarking what occurs in other jurisdictions. This market review is expected to be well under way in the first quarter of 2018 after which initial rules will be established to guide future price increases and changes as well as broader regulation of the fuel sector.

More work still needs to be done to ensure that information now being provided about the actual cost of fuel to wholesalers is as transparent as it needs to be. But we intend to get to where we need to be to protect consumers. I am happy that fuel wholesalers are working with Government and I trust that they too appreciate the need for Government to ensure that consumers are treated fairly. I want to say to the fuel companies that whilst legislation provides Government the ability to initiate price controls on fuel, this is not the intention of this Government. Rather our intention is to ensure that consumers pay a fair price for fuel. And so as I said, I appreciate the cooperation we have had from them to date and Government expects that this cooperation will continue to the mutual benefit of the fuel sector and the people of these Islands. But Mr. Speaker, let me be clear about something. If this cooperation does not continue to our satisfaction and Government is of the view that the only way to properly protect consumers would be to institute price controls, then it should be understood that we will do so. But let me say again, this “nuclear option” would be a last resort.

With regard to liquid propane gas, we are seeing new entrants to the market and it is anticipated that this will improve competition. However, liquid propane gas will also be regulated by OffReg and once rules covering price increases and other facets of the sector are in place, this sector will also be required to fully comply with those rules.

Mr. Speaker, just as fuel is a necessity, so is affordable housing.

As I said during the SPS, we know that more needs to be done in the affordable housing market. However, Government does not have the ability to solve this problem on its own, nor should we. The private sector has a role to play and we will encourage private investment in affordable housing through import duty reductions and by allowing homes to be built on smaller lots. In addition, we will extend the Guaranteed Home Assisted Mortgage programme so that banks can more readily lend Caymanians money to purchase these affordable homes. We are also encouraging the National Housing Development Trust to utilize funds now available to them to invest in new affordable home schemes.

I assure this House and all within hearing my voice that while we continue to work to improve education, sustain our economy, and reduce unemployment, we are also paying close attention to the safety and security of all who live in and visit these Islands.

We have all heard concerns about increases in what is often termed nuisance crimes – everything from petty theft, illegal motorcycles and speeding vehicles, but of greater concern are the incidents of robberies and violent crimes. These too often involve guns and too often arise out of gangs and drugs issues. The immediate response has to be more effective policing.

We campaigned on the need for improvements to community policing and I was heartened that the Commissioner is of the same view and that this is one of his priority areas. That said, I have asked that he look into utilising what I initially termed a community warden approach, as has been used in the United Kingdom and elsewhere, to enhance the community policing efforts rather than police constables who may be better utilised solving crimes. I was encouraged that he has agreed to introduce what he is calling Police Community Support Officers, which is similar to the community warden approach.

Community policing has the benefit of not only utilising a suitable person who will know the people in the communities served, but importantly the people will get to know and trust the officers. Police Community Support Officers need to be trained to understand aspects of the law and some policing methods, but do not have to fulfil all the requirements of a fully trained police officer. Indeed, there may be former police officers who, though retired, are still fit enough to serve in a Police Community Support Officer capacity.

As such, our Government has agreed to the request from the Police Commissioner for new resources to tackle crime on our streets. A new Inspector of Community Policing was appointed in September and 12 community policing sectors on Grand Cayman have been identified where community officers will be deployed. This is in addition to the Sister Islands where all officers are considered community officers.

Of the 75 new officer positions included in the budget for the next three years, at 25 per year, nearly one-third will be dedicated to community policing. A job description for community policing has been developed, and the current plan is to engage a few individuals to fill these roles in a pilot project in three of the main community policing sectors before the end of 2017.

As we provide additional resources to the RCIPS we will insist that resources are used as agreed and hold the Commissioner to account for the results of those expenditures. We also intend to discuss with the UK the establishment of a Police Authority to help create new approaches in fostering accountability and enhance the responsiveness of the RCIPS to the people’s concerns.

We are also committing additional capital funding to bolster coastal defence. A Strategic Maritime Security Management Committee will oversee the evolution of the Joint Marine Unit into a National Coast Guard Service. The Committee will be chaired by the Chief Officer for the Ministry responsible for immigration, and comprise senior executives of ministries and agencies involved in maritime border security, law enforcement, and public safety.

Suitable expertise from the UK’s Maritime and Coast Guard Agency along with the experience of our local experts will be utilized to develop a modern maritime safety and security organisation that will provide search and rescue capabilities as well as the detection and interdiction of boats arriving in Cayman waters with illegal cargo.The transition to a Coast Guard Service will entail significant change including legislation and policy, organisational standards, structure, and operations. This transition will involve a carefully planned approach over the following two years.

Mr. Speaker, we are increasing resources to the Fire and Prison Service, the Department of Community Rehabilitation and Hazard Management to enhance delivery of criminal justice, public safety and disaster mitigation services. This will result in safer communities and improved opportunities for offenders to reintegrate into society after incarceration.

As we continue to fund these various initiatives involving security, we also need to be mindful of those already caught up in the criminal justice system. It is important to cut repeat offending by encouraging the rehabilitation of offenders and support them into employment on their release from prison. Government – that is civil service - is leading the way with its Second Chances programme that seeks to provide employment to former prisoners. There are also several private sector companies that do their part - but as I have said before, more needs to be done and this will be a focus area.

Mr. Speaker the previous administration developed and passed the Conditional Release Law. The new Conditional Release Scheme has been operating for one and half years now. This means that all prisoners that serve sentences of one year or more have to spend a minimum of 60 per cent of their sentence in prison and the remainder in the community under strict license assuming they have been behaving well. Mr. Speaker, research has shown that community reintegration is an important part of rehabilitation and the more time released prisoners spend in the community under supervision the greater the likelihood of reduced recidivism. The new Conditional Release Board considers prisoners who have undertaken the required rehabilitative programmes whilst in prison with the option of continuing their rehabilitation in the community and carefully assessing suitability for release to society.

Previously prisoners were released under the old regime after 2/3rd of the sentence was completed regardless of the risk involved or the extent of the rehabilitation. Mr. Speaker, I am happy to say that only three prisoners in the last 18 months have been re-incarcerated for breaking license conditions. This means that the Conditional Release scheme is working. Over time this will have a positive effect on re-offending rates and consequently the safety of our community.

Mr. Speaker, another important development in improving the Criminal Justice System was the passing of the Criminal Records (Spent Convictions) Law, 2016 which allows for criminal records to be expunged.

Expungement is essentially having a conviction removed from one’s criminal/police record after a specific period of time has elapsed and after certain requirements have been met.

The principle underlying this is that a person who has made a sincere and successful attempt to be a law abiding citizen should be given the opportunity to start afresh without being haunted by his or her unfortunate past indefinitely.

Since the 28th March, 2017, the Criminal Records Office has been processing applications for automatic expungement for those persons that were sentenced to imprisonment for a term not exceeding five years. This means that persons who have met the crime free period specified in the law are receiving a clean police record and are afforded an opportunity to be productive citizens. For those persons that were given a sentence exceeding five years, and have a crime free period of 15 years, the Expungement Board will deal with these applications.

In addition the Board will deal with applications for expunging records for persons convicted of minor marijuana offences such as possession or smoking of marijuana where trafficking or intent to supply is not involved. This will benefit young people specifically in getting employment.

Mr. Speaker I am pleased to be able to report that the Board has now been established and training of Board members has commenced. It is expected that the Board will be fully operational and will begin processing applications in just a few weeks.

On the judicial side of law enforcement, the Office of the Director of Public Prosecutions will establish a Justice Protection Administrative Centre as is required by the Justice Protection Law (2017 Revision). The Centre will develop, manage and administer a witness protection programme for the Islands. In tandem with the proposed Centre, a new Witness Care Unit will also be established in order to provide closer liaison with victims and witnesses.

All these measures are about dealing with crime now. In the longer term, the answer lies in stopping our people turning to crime in the first place. I believe the most significant contribution to crime reduction, besides a good education, will come from the early identification of young people at risk of offending behaviour, and implementing programmes to help them make better life choices – choices that will benefit them, their families and their communities. Work on this commenced during the last administration and an Inter-Ministerial Committee on Youth Affairs has been established to serve as the coordinating and advisory body to implement plans in this area. The Department of Children and Family Services will be an important part of the overall solution through social workers who specialize in family crises resolution and trauma. But they cannot do it alone. This requires work and cooperation across many ministries for there to be real success.

Mr. Speaker, a Multi-Agency Safeguarding Hub Team, or MASH, was created in 2016 where the Ministry of Community Affairs, in conjunction with the Department of Children and Family Services, works with the Royal Cayman Islands Police Service, Education Department and Health Services to enhance the safety of our children.That Ministry is now under a new interim acting Chief Officer who, with her team, will strategically plan and restructure the Department’s resources to enhance services and meet the needs of its clients in a timely, effective and efficient manner across all three Islands.

Another of the major social issues facing our country is to ensure people have access to quality, affordable healthcare.

We have some of the most modern and best healthcare facilities available anywhere in the region with three hospitals here on Grand Cayman – George Town Hospital, The Doctors Hospital at CTMH and Health City – as well as Faith Hospital on Cayman Brac. The advent of Health City has allowed affordable and easily accessible tertiary care, for a wide range of health concerns here at home instead of mandatory, expensive overseas travel.

Unfortunately we have all heard concerns expressed by Caymanians who are unable to readily benefit from that facility. There are times when patients are being sent overseas when quality tertiary care is available locally - at less cost to Government and to families.

Over the course of this budget term we will improve the working arrangement with Health City, and with other medical facilities, to ensure that more Caymanians, especially those insured through CINICO, can more easily benefit from the high-quality healthcare they provide.

On the subject of CINICO, Mr. Speaker, the Cayman Islands National Insurance Company looms large in each budgeting process Government undertakes.CINICO was created nearly 15 years ago. Since that time, welcome advances in medical science and changes to insurance markets have occurred at unprecedented rates while CINICO itself has remained largely unchanged. As a result, it looks out of date. Therefore, while this budget does provide for further significant investment in CINICO, we do not believe the answer does not lie in continuing massive annual increases to CINICO’s budget but in recognizing the need for reform.Part of the solution to making CINICO more financially viable is to broaden its role as part of an overall reform of the insurance market. At the moment it falls to CINICO to cover those people unable to afford private insurance cover – essentially with Government picking up the full cost. Frankly, this is unsustainable. CINICO must be able to provide insurance cover to a broader demographic to lower the overall costs to the public purse.

At the same time, as we all know, the medical services offered through the Health Services Authority must not only be of a high standard but must be run efficiently. The Auditor General’s Report on the Cayman Islands Health System, along with their health industry survey, provides useful insight into the state of local healthcare - what we are doing well and where there are challenges.

As I said when I recently spoke to the SPS, improving the efficiency and effectiveness of our healthcare system will require a long term, strategic change, including devising new working arrangements that will create the changes needed and identify what services should be focused on in future years. A first step is to talk with the industry players, including those at the HSA, to determine what reforms are needed, and to devise new working arrangements that will serve as the impetus for the changes we need to see and identify what services should be focused on in future years.

Mr. Speaker, during the last Administration, my Caucus as well as the elected members of Cabinet had our own concerns regarding HSA, particularly around the management of its finances. And so Government insisted that the Financial Secretary or his designate be appointed to the HSA Board. I can say that this took considerably longer than we expected, but we persisted and in the end the HSA Law was amended to allow for this change. Ironically, Mr. Speaker, I recall that several of the current members of the Opposition objected to this change, but I suspect given the concerns that they have recently expressed, they now see the wisdom of ensuring that there is oversight at board level from the Finance Ministry and the Ministry of Health.

As a Government, we have yet to sit down to fully consider, with the help of the Board, what reviews of the HSA may be useful or necessary. But certainly prior to the elections my Progressives team and I did consider the matter of reforms and, as we noted on page 12 of the Progressives Manifesto, our thinking at the time was that a private sector partner should be engaged to work with Government and the HSA Board to determine suitable reforms that would deliver both better health outcomes and lower costs. As this new Government progresses past the budget stage to delivering on our plans, decisions will be taken regarding addressing areas of concern at the HSA, as well as ensuring that there is a focus on the many areas in which they perform well.

On a positive note, I understand that the HSA has targeted next year as its deadline to obtain a clean audit opinion on its finances and have employed Deloitte to advise on how to successfully progress this.

On another positive note, in terms of procurement, work has already begun to reduce costs with the use of the reverse auction system to purchase pharmaceuticals and medical supplies. To date the potential savings are substantial, at a projected 32 per cent of the cost, compared to using traditional procurement methods.Mr. Speaker, the status of our health also extends to our environment, starting with the George Town Landfill.

As has been previously reported, a Dart-led consortium won the bid for the proposed Integrated Solid Waste Management System which, among other things, will replace the current landfill in George Town. The next stage of the process is for government and the Dart-led consortium to finalise technical, financial and legal details before the contract can be signed.

When negotiations are finalized, we will be well on our way to a developing a modern waste management system that will include recycling and composting and ensure that residual waste is not just dumped but used to generate electricity to power Cayman’s homes and businesses.

The existing George Town landfill will be capped and closed and the landfills on Cayman Brac and Little Cayman will also be closed with the garbage from those Islands brought to Grand Cayman to be treated under the new waste management system.

Ground-breaking is anticipated next summer for a phased implementation of the new waste management system, with the aim to have it fully operational, including the waste management plant, by 2021. This budget ensures we have the finances in place to progress against that timeline.

Mr. Speaker, continuing with the environment, I said during the SPS presentation in August: “We remain committed to protecting our environment, but we must also ensure that we get the balance right between preserving our environment and the need to responsibly develop our Islands to help provide employment and opportunities for our people. We will continue to support the environment but we cannot ignore some tension that exists between allowing necessary responsible development and protection of our environment – particularly following the passage of the National Conservation Law. As an example, we are being told that going forward almost every new government road will require some form of Environmental Impact Assessment - increasing the cost as well as the timeliness of completing necessary roads. Truth be told this tension has always been there – and perhaps in the past too often development has won over protecting the environment. However, both aims are important and need to co-exist, with Cabinet receiving proper advice and having the ability to mediate or decide in cases where a side must be chosen. And so, we will look again at the National Conservation Law to determine what amendments need to be made to ensure the proper balance is struck.”

Mr. Speaker, to further explain my position, it is perhaps useful to note that as an integral part of formulating policy, the Cabinet is charged in Section 44 (c) of the Constitution with the responsibility for directing the implementation of such policy insofar as it relates to every aspect of government except those matters for which the Governor has special responsibility.

In seeking to meet the dual policy mandates of protecting the environment and encouraging responsible development to provide employment opportunities for Caymanians through sustainable economic activity, the Government must ensure that a proper balance is struck between these sometimes competing goals and objectives. The need for this balance to be struck is enshrined in Section 18 of the Constitution.

Whilst my remarks on the SPS were limited to road building, it has become clear since then that the road building issue is only representative of the potential difficulties that are likely to arise in the context of the day-to-day application of Sections 41 and 43 of the Conservation Law. These sections allow the Council broad and generally unfettered discretion to require Environmental Impact Assessments in a wide range of cases. These and related provisions have the potential to serve as material impediments not only to the orderly business of government bodies and agencies that must consult with the National Conservation Council, but also for those persons who may apply to those bodies and agencies for approvals or permits of one type or another and where the approval of the Council becomes necessary in order to proceed.Other provisions of the Law raise similar concerns as to whether the right balance exists between conservation and development, such as Section 21 dealing with Coastal Works permits.

Given the varied concerns expressed, the Cabinet has determined that it will appoint a stakeholder committee with a sufficient cross section of representation to review these and any other issues that the Committee may come across as a part of the exercise. It is expected that the Committee will make recommendations for ways in which the legislation can more effectively satisfy the twin goals of Section 18 of the Constitution regarding fostering and protecting the environment while promoting justifiable economic and social development.

As is often the case when a law is first enacted, the practical application of its provisions may often differ, and sometimes materially so, from what was envisaged when it was enacted. The proposed review of the legislation is reflective of that reality and is not abandonment by the Government of its commitment to protecting and enhancing our natural environment. We anticipate that the NCL Review Committee will be constituted before year end and begin its work early in the New Year.While we are discussing matters dealing with the environment, Mr. Speaker, I am pleased to advise this Honourable House that we will be further strengthening the public’s rights to beach access through policies, procedures and regulations that guide the operations of the Public Lands Commission, which was established in June this year. This Commission will ensure that beach access by the public is safeguarded and maintained on all three of our Islands. This continues the work started last year by Government to reopen and protect the public’s right to access to our beaches.

This budget also includes $1.1M for a more aggressive approach to eradicate the green iguana; and a further $1.7M for the eradication of the Aedes Aegypti mosquito with continued assistance of Oxitec.

Mr. Speaker, from an environmental perspective the sheer number of green iguanas, due in part to their extremely rapid reproduction rate, means they are wreaking environmental damage to the areas they inhabit, devouring plants, defoliating and killing native trees, and stressing and out-competing indigenous animals for food sources, not to mention what they do to farmers. And it is important that we keep the disease carrying Aedes Aegypti mosquito in check to prevent zika, chikungunya and dengue in the Cayman Islands. Government will continue its support of the Mosquito Research and Control Unit and the various programmes they are so effectively implementing.

There are specific environmental as well as other needs on the Sister Islands to which we will respond. We will continue to build infrastructure to deliver piped water throughout Cayman Brac. Work continues on the multi-purpose centre as well as at the sports facility, both on the Bluff, and jetty docks on Little Cayman to facilitate small craft access to shore.

Our pristine and healthy environment is both precious and profitable. It draws more and more visitors to all three Islands each year. More and more people are flocking to our paradise in the Caribbean Sea.

Our air arrivals are significantly outpacing projections bringing us closer to registering 400,000 tourists by air by the end of 2017.

Our September air arrivals are up by 14.7 per cent with 16,845 visitors arriving during September 2017 compared to 14,677 in September last year. Visitors from the United States, Canada, the UK, Brazil and Latin America are all up over the corresponding period in 2016. The Tourism Industry’s performance remains robust and is exceeding expectations. I have no doubt the Deputy Premier and Tourism Minister will have more good things to tell you in his budget contribution.The numbers demonstrate that the strategies the minister then and minister now has implemented to boost the shoulder season and slower periods during summer are working well. This is an excellent achievement for the Cayman Islands.

I commend the Ministry and Department of Tourism and the Islands’ private sector partners for their unified, innovative and consistent efforts to promote the Cayman Islands as the destination of choice for a magnificent vacation. This budget allows them to continue their work.

When visitor numbers are up, the economy gets a corresponding boost as more tourists mean more business for restaurants, taxi and tour operators, retail stores and more revenue for tourist attractions. This growth is spurring development of new hotels such as NCB’s newly proposed boutique hotel in George Town. Planning for new hotels and condos are also in the works.

Mr. Speaker, this Government will continue to support enhanced tourism marketing to high value source markets and fully implement the new five-year National Tourism Plan in 2018.

Also helping facilitate the growth in tourism is the redevelopment of Owen Roberts International Airport. The renovation project there is well under way and when completed in early 2019 will allow it to serve nearly 2 million passengers a year.

Work to provide a modern cruise berthing facility and an enlarged cargo port is progressing with the completion of preliminary design and cost estimations.Prequalification of bidders is complete and negotiations with cruise lines are in the final stages. Coral recruitment has been completed and an application submitted to the Department of Environment for trial relocation. The bid documents are being finalized, with the next procurement stage in November 2017.

An enlarged, modern cargo facility is key to our ongoing economic development and will give us the ability to accept larger ships, reducing shipping costs and consequently reducing the cost of goods bought locally. The Port Authority has also received considerable interest from shipping companies that not only want to bring their larger ships here, but have indicated that Grand Cayman could serve as a transshipment port for perishable cargo out of Central America. The economic potential for George Town to serve as a transshipment port is certainly welcomed and will be pursued.

Part of our tourism strategy includes the revitalisation of George Town. And so the work on the George Town Revitalisation project will move past the phase one roadbuilding stage and, starting in 2018, other aspects of the project will be introduced, including making George Town more visitor friendly.

We are in the process of hiring a town manager for the capital. The town manager will initially work within the Ministry to help finalize the revitalization plan. And in the new year Government will work with the private sector to establish the George Town Urban Development Commission. The major impetus over the last three to four years has been the completion of the necessary roadworks deemed instrumental to the revitalisation project as a whole. The first phase of Linford Pierson Highway is part of that and is due for completion early next year with Phase Two to be completed in 2019.

And, Mr. Speaker, it is worth repeating what many have heard me say before, all of this work is being done from cash surpluses, not from borrowing. Indeed, this Government, like the last Administration, continues to operate from a cash position for both operational and capital commitments.

One of those capital projects is enhancing the Government’s Information Technology services, including cyber-security and E-government initiatives.The E-Government programme, which we began to implement in the last term, is being rolled out and will deliver improved access to more responsive public services while achieving considerable efficiencies in their delivery. Government will introduce more online services to improve customer experience. Already people can apply for Police clearance online and beginning next month customers will be able to clear goods through Customs electronically. This will be the first phase of the business modernization and refining process that Customs will embark on over the next three years. The Minister responsible for Commerce, Planning and Infrastructure will, I am sure, speak more to these initiatives.

Mr. Speaker we know that the Cayman Islands Government has to keep up with modern technology if we are to continue to be a world leader in the all-important Financial Services Industry.

This Government is committed to continuing to ensure this country provides the right legislative and regulatory frameworks to allow the Financial Services Industry to continue to flourish here. This budget targets resources to enhance the Financial Services policy functions of the Ministry of Financial Services as well as the regulatory services provided by the Cayman Islands Monetary Authority to keep pace with evolving international regulatory requirements.

We will continue our partnership with the financial services sector, including Cayman Finance, to not only improve and market our financial services products, but to also defend our financial services business as and when needed.

I, along with Minister for Financial Services and Home Affairs and other Government officials recently returned from Brussels and the United Kingdom. We were in the EU to assist ministers of finance in their understanding of Cayman’s compliance efforts, prior to the EU’s December 2017 proposed announcement of the jurisdictions that it considers to be noncompliant with global tax good governance standards.

We were well received in the EU and had an opportunity to meet with some of the most influential politicians including European Commission Vice-President Mr. Valdis Dombrovskis, who is in charge of Financial Stability, Financial Services and Capital Markets Union, and other business leaders. Everyone we met agreed that the Cayman Islands is highly compliant with OECD regulations, putting us in the league of countries such as Germany, Canada and the United Kingdom.

However, there were some who were challenged in understanding our no-direct taxation regime and with whom we took time to explain that the Cayman Islands has never had direct taxation, but we do have substantial indirect taxes. We also explained that we do not have double tax treaties that allow for the shifting of tax liabilities and businesses that operate in Cayman understand full well that they have an obligation to pay taxes due in their home jurisdictions.

The Minister and I came away from these meetings with a full appreciation for the need for regular ongoing engagement. To a man and woman, everyone we met with indicated the usefulness of personal engagement and noted their appreciation for our willingness to cross the pond to see them.

Similarly Mr. Speaker, in the UK we took the opportunity to attend the Conservative Party Conference and to meet with as many senior members of the British Government as we could, including Priti Patel, Secretary of State for International Development; Philip Hammond, Chancellor of the Exchequer; Michael Fallon, Secretary of State for Defence; and Boris Johnson, Secretary of State for Foreign Affairs. There were others as well.

Mr. Speaker, as recent press announcements regarding the hacking of databases of international financial services providers underscore, the challenges to financial service jurisdictions such as the Cayman Islands are grave. This remains so despite our exceptional performance in meeting, and in some instances setting, the global standard with respect to our measures in fighting money laundering, tax evasion, terrorism financing and other financial crime and our excellent track record of international cooperation. The latest threatened expose’ by the international media is no doubt timed to influence the views of EU Ministers with respect to the imminent list of uncooperative jurisdictions to which I have just referred and which is due out at the start of December. This example provides the plainest evidence of why it is imperative that as a jurisdiction, the Cayman Islands seizes every opportunity to engage with those that shape policy internationally with respect to financial services matters. They need to hear the true story from us; they will not get it from the media.

Mr. Speaker, one of our final meetings in the UK was with Lord Ahmed, the Overseas Territories Minister, who, like all of the other ministers we met, was aware of Cayman’s humanitarian assistance efforts to our sister British Overseas Territories that were recently damaged by hurricanes Irma and Maria. We talked about the need for the UK to commit, not just short term financial help with the devastation, but long term to help their economies get back on their feet. The Overseas Territories are, after all, part of the British family and we are all British citizens.

Lord Ahmed again expressed his thanks, as had other cabinet ministers that the delegation met over the course of the trip, for the assistance that the Government and the people of the Cayman Islands are providing to those islands affected. He reiterated how grateful the UK government is for the help.

We will continue to work with the BOTs when we travel back to London in November for the annual Joint Ministerial Council where we will continue to discuss hurricane recovery and the economic stability of all BOTs.

I would add, Mr. Speaker that I and the Minister for Home Affairs travel tonight to Miami where we are hosting a meeting for the leaders of the Caribbean British Overseas Territories to discuss the needs of the islands impacted by the hurricanes, prior to the JMC meeting. The goal is to ensure that the needs of those territories impacted by the storms are a key part of the agenda for the London talks.

Mr. Speaker, whilst this plan and budget is forward looking, it is important that we also pause to look back and reflect on where we have come from and celebrate key moments in our history. I am pleased to advise this House that Cabinet has approved the formation of a project committee that will create a full plan to celebrate the 60-year anniversaries of the Cayman Islands Coat of Arms and our first Constitution.

Her Majesty the Queen approved the Royal Warrant assigning “Armorial Ensigns for the Cayman Islands” – that is our Coat of Arms – in May 1958 and our first Constitution was approved by Order in Council in May 1959 in the run up to the independence of Jamaica.

Mr. Speaker, in addition to celebrating momentous occasions in our history, it is important that we also take time to recognise the work of individuals. We already celebrate our people on Heroes Day and we also award worthy individuals with the Cayman Certificate and Badge of Honour. But we need to do more.

Mr. Speaker, several years ago you sought to establish a local Honours system. Regrettably those efforts did not fully take root and there was only one ceremony held. I commend you for that early attempt and I want you and those in this House to know that we will be reviving and reforming the awarding of the Order of the Cayman Islands to worthy individuals. Plans are being firmed up for the Honours scheme, but currently the intention is to award up to three classes, namely Companion, Officer and Member of the Order of the Cayman Islands. We will also be incorporating medals for valour or bravery. As these plans come to fruition, I will keep this House and the public advised.

Mr. Speaker following consultation with you, we will progress the work for making the operations of this House more autonomous. We can expect a draft bill early next year.

Mr. Speaker, you will see that this Government has not been sitting by idly since the May elections. As I said in my Strategic Policy Statement to the House and the public in August, this is a Government of National Unity in which all views are valued and respected.

Just as this Government’s Strategic Policy programme was a result of our collaboration and hard work, so is the budget we are presenting to the members of this Honourable House.

I thank the Minister of Finance and Economic Development and his team, particularly the Financial Secretary, for their hard work and dedication in producing this budget. Many hands, heads and hearts have contributed to its preparation and I offer my profound gratitude to those who have toiled many late hours to produce this important document.

Mr. Speaker, I thank my entire team, Ministers and Councilors, for their hard work and commitment. I also wish to thank the Deputy Governor, Attorney General and the Cabinet Secretary for their work and support.

To the civil servants who are charged with implementing our policies, programmes and projects, I thank you.

I also thank my small but dynamic team in the Office of the Premier that provides support to me and the Government Caucus.

I agree with former Alabama Governor and politician Bob Riley who said, “Nothing is worse, or more of a breach of the social contract between citizen and state, than for government officials, bureaucrats and agencies to waste the money entrusted to them by the people they serve”.

We understand that when our people went to the polls in May that they were looking for a Government worthy of their trust.

The National Unity Government, which I have the honour to lead, is that Government.

As I did last year, I urge the House to remain focused on those things that are good, those things that are right, and those things that are in the best interest of the people of the Cayman Islands. After all, that is why they accorded us the great privilege of being here.

Thank you.

Oct 19, 2017

8th Annual Cayman Islands Healthcare Confere...

Oct 19, 2017

8th Annual Cayman Islands Healthcare Conference

Good evening,

And welcome to the 8th annual Cayman Islands Healthcare Conference.

I’m very happy to see that each year this conference gets bigger and better and I’d like to take this opportunity to personally thank our generous sponsors for their continued commitment and support. Thanks to the Minister for Health, Hon. Dwayne Seymour, the Chief Officer, Jennifer Ahearn and everyone who has been involved in the organisation of this event and I also thank and welcome our local and international healthcare providers and presenters who are sharing their time with us.

To those of you attending this conference from overseas, whilst I know you have a packed agenda I hope you can find some time to enjoy all that we have to offer from our pristine beaches to our wonderful people.

As the former Health Minister, and also someone who watches what I eat, tries to exercise regularly and wherever possible lead a healthy life, the topics for this year’s conference are dear to my heart. As my father often says “far too many of us are digging our graves with our teeth” And it’s true. We are what we eat.

Over the next two days, you will explore the relationship between nutrition and health. A key theme throughout the conference will be the topic of healthy eating - particularly for children, both at home and at school. Extra weight and obesity in youngsters are among the greatest risks to children’s’ long and short-term health. Overweight children are prone to becoming overweight grownups, and therefore also more prone to heart diseases, cancer, diabetes, stroke and osteoarthritis.

There will be a strong focus on establishing healthy eating habits from an early age to show how we can each take action to prevent some of the health issues that affect so many in our community.

This all echoes what I said when I presented the Strategic Policy Statement back in August that more needs to be done to prevent health problems arising in the first place. Too many people in our communities are dying prematurely or have to live with long-term preventable conditions. I, along with the Minister of Health, committed to renew our efforts in public health programmes and promote healthy lifestyles among our people. But perhaps the best opportunities for change lie with teaching our children at an early age the value of healthy food choices and encouraging a love for physical activity.

This conference is not just for health care professionals, there is literally something for everyone and we hope at the end of these two days everyone will walk away with something that you can take on-board to help you live a healthier life.

Thanks to everyone for attending and once again I’d like to recognize our sponsors who are helping us to achieve our main mission which is to reach out to as many residents as possible to offer them solutions to improve their health and well-being.

I’ll close now and hand over to the Deputy Governor the Hon. Franz Manderson.

Thank you.

Sep 14, 2017

Welcome, SMP Partners

Sep 14, 2017

Welcome, SMP Partners

Welcome to SMP

By Premier Hon. Alden McLaughlin, MBE, JP, MLA

6 p.m. Thursday, 14 September, 2017

The Ritz-Carlton

Good evening,

I’d like to thank Steve McGowan, Stephen Turner and Oliver Peck for inviting me to say a few words this evening.

My Government is very pleased that you are establishing your new regional head office in the Cayman Islands. This not only speaks volumes to Cayman’s reputation as a leading trust jurisdiction but to your confidence in us as you progress your Caribbean growth strategy.

The services you bring to Cayman, makes us attractive to global clients, which include trust, fund administration, company formation, management and accounting and tax advice management.

We know there is an increased level of interest in the Cayman Islands from the Asian market and your presence in Hong Kong will only serve to bolster our message and attract even more clients to our shores.

With your acquisition of Royal Bank of Canada’s Trust, Custody and Fund Administration businesses in the Caribbean you’ve not only added a good book of business but you’ve also been able to keep on board some 30 experienced professionals including local senior personnel who I’m sure will allow you to continue with your key client relationships and to build your business from strength to strength. When all else is equal good people and strong client relationships set you apart from your competition.

I know that SMP has had a presence in Cayman since 2012, following your acquisition of the trust and life insurance business from Bank Julius Baer in the Bahamas and the Cayman Islands, so we’ve been part of SMP’s growth strategy for some time.

As Premier of the Cayman Islands of course I commend SMP Partners for your very good sense in not only setting up here initially in 2012 but also for your extremely good sense in making these Islands your Regional base. These islands have wonderful people, a tropical climate, and a quality lifestyle - we are also a place that’s open and conducive to business.

We also understand that being open to business includes planning for natural disasters. Given recent storms that have impacted the Caribbean, I want to remind you that we experienced our own Irma back in 2004 when Hurricane Ivan hit our shores as a category 4 storm. The strength and resilience of the robust hurricane plans of both Government and the private sector meant that many key businesses were up and running within a few days with very little interruption for International clients.

We all learnt many lessons from Ivan, and key organizations throughout the Islands from banks, telecoms providers, insurance companies, trust companies and Government have all improved their continuity plans.

In closing, I want to acknowledge SMP’s long established commitment to the communities in which it works and am pleased that tonight there will be an announcement regarding a local charity, chosen by your team that will benefit from the generosity of the company. I thank you for your spirit of community.

Again, I’d like to thank you for choosing the Cayman Islands as the jurisdiction for your new regional head office and I look forward to meeting members of the team tonight.

Aug 23, 2017

Strategic Policy Statement 2018

Aug 23, 2017

Strategic Policy Statement 2018

Mr. Speaker, this Motion seeks the approval of this Honourable House for the Government’s 2018-19 Strategic Policy Statement, which the Minister of Finance and Economic Development has just tabled.

I would like to start by congratulating him for his excellent introduction to his first Strategic Policy Statement and I would like to thank him and his team in the Ministry, in particular the Financial Secretary and his team, which coordinated the production of the statement.

This Strategic Policy Statement fulfils its statutory requirement to set out my Administration’s key fiscal priorities and our broad strategic outcome objectives for the Cayman Islands. It also puts forth the Government’s financial targets for the next three financial years, covering in more detail for the first time, a two-year period, 1st January, 2018, to 31st December, 2019.

However, this exercise is more than simply about meeting our statutory obligations. This SPS gives me the first formal chance to set out the programme of the new Government of National Unity, which came together following last May’s election.

A great deal of work has gone in to shaping this programme and I want to thank all Members in the coalition for their contributions. I said this is a government of national unity in which all views are valued and respected. I am pleased to report Mr. Speaker that my colleagues on the government benches have taken me at my word and they were certainly robust in the views expressed as we debated our priorities.

This Government’s programme is stronger as a result of the vigorous nature of our discussions. It is a programme that is more ambitious for the challenges we presented to each other in our debates. It is a programme we are confident can be delivered because of the way we have brought the civil service into our deliberations.

Before I set out that programme, I hope you will indulge me, Mr. Speaker, if I digress slightly to offer the House four things that have shaped my own thinking in the last few months.

The first is a feeling of humility. I am very conscious, Mr. Speaker, that I am the first Premier in our modern political history to serve a full term and then to form a second, consecutive Administration. I do not take the support of our people for granted. While they elected the Progressives as the largest party in May’s election, we were not elected as a majority government. That is why a coalition of national unity was not only necessary but also underlines the need to remain in touch with and responsive to the views of Caymanians over the next four years.

In accepting the role of Premier for a second time, I realise I am taking on a great responsibility. I do not believe the office of Premier is about self-promotion. Rather, it is about service and I will continue to do all that I can to serve the people of these Islands to the best of my ability.

The second thought I wanted to offer the House is that this is a time of real opportunity for the Cayman Islands. Of course, there are challenges ahead and I do not underestimate the potential of both man-made and natural disasters to knock us off course. However, I believe there are real grounds for optimism about our future and for belief that we as a people can come together and move forward with confidence.

My third reflection has been that if we are to take advantage of our opportunities we need to be more ambitious. In particular, as a Government, we need to go well beyond what has been done before, from improvements in the quality of our public services through to our approach in economic growth. We need to challenge the status quo and set stretching goals that will lead to real improvements in the quality of life for our people.

My final, and perhaps most important, thought is that it is all very well to be humble and willing to serve, to recognise opportunity, and to be ambitious. However, all that is for nought if nothing different happens.

I am proud of what the last Progressives-led Administration achieved. However, there were certainly times I felt the frustration of delay and inaction within the machinery that is Government. Let me be clear, I have learned from that experience. As the House will know, I cannot serve, nor do I wish to serve, a third consecutive term as Premier. So I will be going flat out to push for delivery of our priorities in the next 3 and a 1/2 years. To borrow an American sporting expression, Mr. Speaker, I will be leaving everything on the field.

The crucial difference in this Administration’s approach must be that we create and sustain a consistent and constant culture of delivery. Mr. Speaker, our people have every right to expect that the promises we made as we campaigned for the election will now be delivered.

In turn we will have set an expectation of delivery across Government to ensure that our people’s expectations are met. I thank the Deputy Governor and his chief officers for their willingness to embrace the challenges we are giving them.

An expectation of delivery first requires us to be clear on our intentions. The final expression of that will be the budget we will bring to this House in a couple of months’ time. Our intention is that the budget will not only be balanced and fully compliant with the requirements of prudent financial management, but that it will allocate resources to the political priorities we have promised to deliver. This Strategic Policy Statement creates the framework for that to happen.

The work that has been done within the Government Caucus over the last few months has identified eight strategic objectives that are set out in the SPS that the Honourable Minister has just introduced. Under each of those objectives, Caucus has set out its ambitions for delivery and prioritised actions to be achieved in the coming two-year period the budget will cover.

One reflection I will offer, if I may, Mr. Speaker, is that the eight strategic objectives were fairly readily agreed by all Members of the coalition. In our various ways, we had all proposed similar themes during the election campaign that we found could be brought together to form a cohesive Government programme. There was great discussion over how those objectives should be achieved and over which possible actions should be prioritised. But as I have said

before, one of the strengths of a working coalition is that this kind of debate can create a strong programme that will benefit Caymanian families and businesses.Throughout my political career, I have made the achievement of economic growth central to my thinking about the role of government. Put very simply, in our three small Islands, unless we secure economic growth, we have no chance of achieving anything else. I recall well former legislators who sat in this Hallowed Chamber stating that the only true independence is economic independence. They understood that economic growth is necessary to create the revenues that allow Government to pursue its objectives and ambitions for our Islands and our people.

It is unsurprising then that the first strategic objective in the SPS focuses on a strong economy to help families and businesses. Central to that objective is action to enhance our key economic sectors of financial services and sustainable tourism. In particular, we will drive the completion of the key infrastructure projects begun in the last term – a modern landfill and waste to energy plant, the redevelopment of Owen Roberts International Airport, the delivery of a modern cruise pier and cargo dock, and the revitalisation of George Town.

We will continue our partnership with the financial services sector, including Cayman Finance, to not only improve and market our financial services products, but to also defend our financial services business as and when needed. The challenges in this respect never go away. But we will defend our Islands and our way of living at home and abroad, just as I did last term at Chatham House, and on BBC’s Hardtalk, at the Anti-corruption Summit and at the FCO in London. And as you Mr. Speaker as the former Finance Services Minister also did in London, New York, Washington and Brussels. Indeed, Mr. Speaker the current Financial Services Minister and I will visit Brussels and the UK next month as we continue to fight off the newest round of challenges. Diplomacy and standing firm are both necessary – but so is relationship building. To this end I am pleased to say that the London Office, under the able leadership of Mr. Eric Bush, is doing an extremely good job in rebuilding and improving relationships across Westminster. And it is paying dividends. An example of this is the recent re-formation of the Cayman Islands All Party Parliamentary Group at Westminster whose members have been actively giving our Islands even more prominence in London.

The Financial Services sector faces challenges but it continues to do well and we will continue to provide the support needed to ensure that it continues to thrive.We will also ensure that our Tourism Industry continues to grow from strength to strength. Tourist arrivals increased significantly over the past four years and remain robust. And they are expected to remain so in the coming years. In response to this, there are several new hotel projects planned that will cater to the increasing demand for room stock. The Owen Roberts Airport renovation project is well under way and when completed in early 2019 will readily serve increasing visitor air arrivals.

To ensure we are prepared to meet the challenges and opportunities of a growing tourism market we will fully implement the new five-year National Tourism Plan in 2018 – work on which was started in October 2016.

We will also continue to support Cayman Airways. The National Carrier is a key partner in helping drive our tourism product by bringing us tourists and opening new gateways and markets. As such, it is important to our economy and employs more than 300 Caymanians.

Work to provide a modern cruise berthing facility and an enlarged cargo port has also been progressing, in particular in the redesign of the piers to dramatically reduce dredging and impact on the environment. Preliminary designs and cost estimations are complete. Prequalification of bidders and negotiations with cruise lines are ongoing as well as is the preparation of bid documents, with a projected tender issue date at the end of September 2017.

It is worth noting that this project includes an enlarged modern cargo facility, which is key to our ongoing economic development. The ability to accept larger ships will reduce shipping costs and consequently reduce the cost of goods bought locally. It will also allow fresh fruit and produce to be brought in directly from Central America by ships that now bypass us by for Florida. And as reported recently in the Journal newspaper, the Port Authority is receiving considerable interest from shipping companies that not only want to bring their larger ships

here, but have indicated that Grand Cayman could be a transhipment port for perishable cargo out of Central America. We will see how this develops, but at the moment the potential is certainly welcomed and will be pursued.

Part of our tourism strategy includes the revitalisation of George Town. And so the work on the George Town Revitalisation project will move past the phase one roadbuilding stage and, starting in 2018, other aspects of the project will be introduced, including making George Town more tourist friendly. I will speak in greater detail about this when the budget comes to the House. In terms of the ongoing roadworks, I believe that the public is already seeing the benefit of the work done to date. And I wish to remind Honourable Members and the public that this work is being done not with borrowing, but from cash surpluses. Indeed, this Government, like the last Administration, continues to operate from a cash position for both operational and capital commitments.

We recognise, though, that the strategy of support for our twin economic pillars creates two challenges. The first is that growth is too often centred on George Town and West Bay Road. The second is the vulnerability of our economy to shocks in either or both of the pillar industries. This Government will act to mitigate those challenges by implementing an idea set out by our coalition partners - to develop and implement area economic growth plans to secure the geographical rebalancing of our economy and sector growth plans aimed at economic diversification.

Before anyone misinterprets what the economic growth plans might be about, let me be clear. This is not an attempt to recreate Stalinist economic planning in the Cayman Islands. Rather it is about government using its economic levers, from duty concessions to planning rules, to support our economy to grow in ways that are sustainable in the long term and spread benefits to families and businesses across our Islands. It is also about encouraging and assisting, where possible, growth in new and emerging sectors. Medical Tourism, conference tourism, technology and Special Economic Zones are some areas with potential. And if all goes well it may include cargo transhipment as mentioned earlier.

Another crucial part of our economy is the small business sector. This Government will act to ensure it is easier to set up and grow your own business in Cayman, especially for Caymanians. We wish to see a sensible drive for practical deregulation and we are willing to work with business to cut unnecessary red tape. We will seek opportunities to continue the work of last term and further ease the burden of duties and fees on small business where possible and will do what we can to support easier access to affordable funding. We will also work with the Small Business Association to introduce a Small Business Development centre to assist with training and help for small businesses to start up and be successful.

An essential economic sector for our Islands remains agriculture. Here the Government will continue to support farmers and encourage the adoption of modern farming techniques to improve both quality and yields. This makes sense for our economy and enhances our food security. As a farmer myself I would add that farming, though hard work, can provide a pretty decent livelihood.

But whilst we appreciate that a strong economy is a key objective, we also acknowledge that all Caymanians should benefit from this economy. A growing economy naturally creates more jobs and offers more opportunities for Caymanians to benefit, but not all will benefit in the same way. There are things Government can do directly to help improve the standard of living for all. We will review the minimum wage to ensure it is keeping pace with inflation. Mr. Speaker, not only was this a campaign promise of the Progressives, but it is necessary to ensure that the minimum wage remains relevant to the people it is intended to help.

We, and Mr. Speaker I include you and others in the Coalition Government, also campaigned on providing added assistance to those in need – but doing so in a responsible and sustainable manner. There is an expression that a rising tide lifts all boats – and indeed it does. But as Rahul Ghandi once noted, a rising tide does not lift those people who do not have boats. And so as the economy grows and benefits the majority, we need to ensure that we do not forget those who need a helping hand. So, I am happy to advise the members opposite that the Government will be fulfilling the promises made during the election campaign concerning improvements to social service assistance.

Firstly, we will increase the ex-gratia ‘poor relief’ payments made to Caymanians who are challenged to provide for themselves – either because of physical disability, advanced age, or mental incapacity. Presently they receive a stipend of $550 per month and we will increase this to $650 monthly from January 2018 and then to $750 in January 2019. I would add that we were initially looking to provide a higher amount - but an additional $1,200 per year per person is what was found to be affordable and sustainable Mr. Speaker. However, it is worthwhile noting that Government also assists these individuals in many other ways – with medical costs, utilities, and other benefits as well. In this financial year alone some $125M will be spent on social services needs.

Mr. Speaker we will also provide an increase to the Seamen’s and Veteran’s ex-gratia grant similar to what was just outlined for poor persons’ relief – from $550 monthly to $650 in January 2018 and to $750 in January 2019. Many of our elderly seafarers have no pension and rely every month on this stipend. I know Mr. Speaker this is something you campaigned on and I am glad that we have been able to provide an increase – albeit not to the level you sought. But again as we start to get into the next budget review we will look at this again for the 2020 and 2021 budget. And I will point out that Government does also provide health insurance for seamen and veterans – so the assistance provided is much more than the ex-gratia payment.

And, Mr. Speaker, we also promised to assist civil service pensioners who served our country for many years but who are now retired in Cayman and receive a sum that is less - in some cases far less - than what is provided for poor relief. We promised during the election campaign to correct this and so the next budget will provide an additional ex-gratia stipend to supplement the pension for retired civil servants with more than 10 years’ tenure, and who reside in the Cayman Islands. The aim is to ensure that they receive a combined sum (pension and ex-gratia payment) that is no less than paid for ‘poor relief’ payments noted previously – that is a minimum sum of $650 per month from January 2018 and $750 from January 2019.

In this SPS we have not accounted for any specific reduction to government duties and fees, but neither are we looking to increase duties. As the Minister of Finance indicated, we will continue the major stimulus policies introduced during the last Administration. These include reduced import duties, lower business licensing fees, development concessions and support to small business as well as initiatives to improve diversification of our economy and employment of our people. We will seek to ensure consumers receive fair pricing in potentially uncompetitive markets - starting with the fuel market as was begun by the last Administration. And so one of the main objectives of the Utility Regulation and Competition Office will be to quickly complete the work needed to ensure fair pricing and competitiveness at the gas pump.

We have recognised there are particular issues in the affordable housing market. We will encourage private sector investment in affordable housing through import duty reductions and allow homes to be built on smaller lots. In addition, we will extend the Guaranteed Home Assisted Mortgage programme so that banks can more readily lend Caymanians money to purchase these affordable homes.

Ronald Reagan once commented that the best social work programme is a good job. I agree - the biggest single contribution to ensuring a decent standard of living is employment. So our second strategic objective is to improve the functioning of the labour market to ensure all Caymanians can find employment. Our commitment to full employment does not mean everyone is employed all the time. There are short term economic fluctuations in construction and tourism, for example, which means many people face short periods of unemployment. However, there is no reason for short term fluctuations to become a long term problems.

Caymanians wishing to work should be able to access employment and should not be disadvantaged in the labour market. The Government in the short term will act to make changes to immigration regulations to improve the fairness and transparency of job advertising. In the longer term, we are establishing the new Human Resources Department to take on the labour, pensions, and work permits functions and to give government the strategic oversight and planning of future human resource requirements. If the strengthening of regulations and their enforcement is required, we will not hesitate to act.

This is not all a one-way street. Many businesses actively hire and develop Caymanians and we will put in place a system to recognise and reward those businesses. The further development of the National Jobs Clearing House will improve the transparency of the work permits process and ultimately make things easier for business and job-seekers alike as all available jobs will be required to be listed there. Work on this was started by the last Administration and will be completed in 2018.

The Cayman success story has been built on the ability of businesses to not only hire and train Caymanians, but also to bring in guest workers to ensure that we have the resources and expertise to grow the economy. As we allow individuals to come and live and work with us, we need to accept that many of them will remain and become Caymanians and have families, children and grandchildren who will become part of the Caymanian fabric. This is how we have grown and how we will continue to develop and build our country.

But we must strike the right balance to ensure that the immigration and work permit systems work more efficiently and are more transparent and fair to those seeking employment, including Caymanians and those wanting to become Permanent Residents. And so we will improve the Immigration Law and points system to try to get this balance right.

Still, some Caymanians need more help to access the labour market. In our last term, Ready2work.Ky was a successful partnership between business and government aimed at supporting such individuals into work. During the pilot of the Ready2Work.Ky programme, assistance was provided to 137 Caymanians who had difficulty keeping employment. When the pilot programme ended, 89 individuals had completed the programme; 64 of which obtained employment and 25 who were engaged in ongoing training, development and recruitment activities.

Government will extend Ready2Work.Ky in this budget cycle and develop new work programmes as necessary to make Caymanians who need extra help work-ready and successful in the workplace. We will also look at how best to work with the private sector to provide more apprenticeship programmes and other work based training for Caymanians.

Work programmes though are a short-term necessity; not a long-term strategy. The key in the longer term is that the Caymanian workforce has the level of education and skills needed in the increasingly globally competitive marketplace. Education was raised as a key concern by both parents and young people during the election campaign.

We have heard directly from businesses about the current and future requirements needed for their workers.

Our third strategic objective is therefore to ensure that we give the best educational opportunities to all our children.

Great education is about the quality of teaching and learning. It reflects strong and able leadership of schools and is underpinned by the quality of the learning environment. It is seen in the results young people achieve and in their future desire to learn that they take with them into work.

As the provider of public education, the Government has an absolute responsibility to support our young people to develop themselves, to help nurture their hopes and ambitions, and ultimately to enable them to achieve all that they strive for. This government will not shirk from that responsibility.

We need to get the basics right. Students in public schools must have the right materials and supplies. Schools themselves must have appropriate equipment and facilities. In this SPS we have budgeted an additional $18M to cover special education; enhancing science, literacy and math; additional teachers as well as skills upgrading for 400 teachers and assistants; and for scholarships and youth programmes.

In addition, on the capital side we have included some $56M for computer software and equipment, and needed improvements at Savannah Primary, Bodden Town Primary, and Red Bay Primary. This also includes funding to start the initial planning work for a new West Bay Primary School as well as complete the new John Gray High School. Across public schools we are developing plans to expand the use of technology to assist teaching and learning.I believe that with this continued focus and investment the country will appreciate how committed we are to provide our children with the best education possible. The new Education Law passed by the last Administration devolves greater authority to schools for their own management and decision-making. In return, we will not hesitate to hold principals and teachers to account for their performance.

We will judge that performance partly in traditional academic terms. We will work with schools to focus on achieving higher standards of attainment, particularly in literacy, numeracy and science. However, for many students - and to meet the needs of our economy - that drive for academic improvement needs to go hand in hand with the expansion of high quality technical and vocational education and skills. By expansion I not only mean programmes and courses, but also expanding the opportunities for youngsters to be exposed to Trade and Vocational Education Training and, where appropriate, encourage them to consider further TVET training locally or overseas. This encouragement should come from the home as well as the school. And so we will ensure that schools’ guidance counsellors also point youngsters to the kind of vocational careers where TVET provides the right training ground. For many of our young people, training and accomplishment in a trade can bring with it a good livelihood as well as employment security for a lifetime. The vast majority of the work permits issued are in the trades – this is because in modern times our people have shied away from the trades including the tourism and construction fields.

And in part because of this general lack of interest, TVET courses have suffered from the development of single purpose initiatives and uncoordinated activity. Contrary to what many believe and say, there are a significant number of TVET programmes available throughout the public and private sectors. In the coming months we will audit the current provision of programmes available and bring forward a coherent strategy to better utilise these programmes. And we will dialogue with private sector to determine what their needs are regarding trained employees. With limited resources, we must ensure that quality available programmes are fully utilised and supported to avoid spending funds unnecessarily and duplicating efforts. We must ensure that we are providing training in the jobs employers need filled.

Mr. Speaker, the House should not be under any illusion about the priority we will attach to acting on the results of the TVET review. So much so that we will be making a clear commitment by setting a target for at least 75 per cent of high school graduates to move on to post-secondary education or training, locally or overseas, by the end of this term. This represents a significant challenge but one to which we are determined to rise.

Mr. Speaker, this Government is also determined to improve the life chances of students with special needs. We will ensure that schools have facilities appropriate to meet the needs of this cohort of learners and that teachers have the necessary training. It is vital that there is an effective partnership between the schools and parents to create the right environment for special needs students. We will encourage the creation of new support mechanisms for parents that facilitate that partnership.When education does not deliver for young people, when people cannot get work and the benefits of growth are not felt by all in society, and when some in our society feel left behind, it creates divisions in our communities and the conditions that foster criminality.

We were left in no doubt talking to voters at the election that crime has become a real concern right across the Cayman Islands. And only recently I attended a residents’ meeting in Central Scranton Park and again heard directly about the crime issues facing that community.

And so our fourth strategic objective is to reduce crime and the fear of crime.

For many, the prime concern has become violent crime, too often involving guns and too often arising out of gangs and drugs issues. Others express concerns about what happens in their community in terms of “nuisance” crime – everything from petty theft, illegal motorcycles and speeding vehicles.

The immediate response has to be more effective policing. My Government has met with and received the requests from the Police Commissioner for new resources to tackle crime on our streets, particularly planned investment in community policing. I will note now that we were not able to entirely meet his requests as the costs exceeded the available funding. But we also had concerns with the request to increase the officer count by a significant number - requiring overseas recruitment - without sight of an overall plan of action. That notwithstanding, we are committed to providing a substantial number of new officers – 75 over the next three years together with added civil service support staff. We campaigned on the need for improvements to community policing and I was heartened that the Commissioner is of the same view and this is one of his priority areas. That said, I have asked that he look into utilising a community warden approach, as has been used in the United Kingdom and elsewhere, to enhance the community policing efforts rather than police constables who may be better utilised solving crimes. I was encouraged that he has agreed to look at this. The community warden approach has the benefit of not only utilising a suitable person who will know the people in the communities served, but importantly they will know and trust him or her. Community wardens need to be trained to understand aspects of the law and some policing methods; but do not have to fulfil the requirements of a trained police officer. Indeed, there may be former police officers who, though retired, are still fit enough to serve in a warden capacity.

We are also committing additional funding on the capital side to bolster coastal defence, including creating a Coast Guard Unit; purchasing new police vehicles and tactical firearms assets; and to provide significant enhancements to border control at our airports. We will also start the work on requirements for building a new West Bay Police Station and a new George Town Police Headquarters; both of which are badly needed.

However, in line with my earlier point on creating a culture of delivery, we will not only provide additional resources to the RCIPS but we will also insist that resources are used as agreed and will hold the Commissioner to account for the results. This will mean creating new approaches that foster accountability and enhance the responsiveness of the RCIPS to the people’s concerns. Our proposal to accomplish this is the establishment of a Cayman Islands Police Authority and we will discuss with Her Excellency, the Governor, how we can establish such a mechanism quickly.

We also need to act more broadly to make things more difficult for criminals. Key to tackling that at the national level is to make our border control more effective – at our airports and around our waters. In addition to a Coast Guard to assist with search and rescue as well as the detection and interdiction of boats arriving in Cayman waters with illegal cargo, we will reform current services to create a new border protection agency. We will do this by combining the law enforcement units in immigration and customs to make a single cohesive border protection unit that will, together with the capabilities of the a coastguard service, have a profound impact on border security. We are serious about making it very difficult for drugs, guns, or illegal persons to enter our waters and for stolen goods to leave our shores.

At the local level, the safest communities are those that take responsibility for themselves. We will encourage and support the establishment of more neighbourhood watch schemes. These, coupled with a more visible Community Warden policing presence, should help keep our communities safer.

These measures are about dealing with crime now. In the longer term, the answer lies in stopping our people turning to crime in the first place. I believe the most significant contribution to crime reduction will come from the early identification of young people at risk of offending behaviour and putting programmes in place to support them to make better life choices – choices that will benefit them, their families and their communities. Work on this commenced during the last administration and an Inter-Ministerial Committee on Youth Affairs

has been established to serve as the coordinating and advisory body to implement plans in this area.Plans also include Department of Children and Family Services operating a Preventive Programme with social workers who specialize in family crises resolution and trauma work. Preventive services are designed to help parents manage their children’s concerning behaviours and help keep at-risk young people out of the juvenile justice system. It is a tall order, but one to which we are committed.

Just as we will look to keep youngsters out of jail, we will not give up on those already caught up in the criminal justice system. We need to cut repeat offending by encouraging the rehabilitation of offenders and support them into employment on their release from prison.

Our last Administration passed the Criminal Records (Spent Convictions) Law to positively impact the prospects of Caymanians who have served their time for offences and have demonstrated their individual ability to live productive lives. It will enhance the employment prospects of ex-offenders and assist in removing travel restrictions. The Law also helps reduce the barriers to successful reintegration into the community.

The next step with the Law is for the Governor to appoint members to the Expungement Board. This board will be able to expunge the records in the Cayman Islands of former and reformed offenders, which aligns us with contemporary international standards while ensuring public safety and protection. Government is leading the way with our Second Chances programme that seeks to provide employment to former prisoners. There are also several private sector companies that do their part - but more needs to be done and this will be a focus area for us.

Another focus will be plans to build a much-needed new courthouse. I hope that by the time we present the budget I will be able to say more on this. But we will be budgeting funds to ensure that the necessary preliminary work can be started.

We will also explore building a new fire station that will serve the Eastern Districts. Necessary repairs will be made to existing stations and new vehicles, including fire trucks, will be purchased. In addition funding will be provided to hire additional fire officers for both the domestic and aerodrome services, and we will invest in necessary protective gear.

Turning to the Prison, funding will be available for necessary repairs but we will also begin exploring building a new facility. This is a major initiative but regrettably a very necessary one as facilities at the Prison are becoming more unsuitable.

Another of the major social issues facing our country is reflected in this Government’s fifth strategic objective – ensuring people have access to quality, affordable healthcare.

We are proud to have some of the best health facilities available anywhere in the region here on Grand Cayman at Health City, and at other medical facilities as well. Yet many Caymanians complain that they are unable to readily benefit from those facilities. Indeed we recently saw a very short lived attempt by a private insurance company refusing to pay claims for services provided by Health City. Admittedly, in recent times some CINICO clients have seen improvements to accessing care at Health City, but we still receive too many complaints from the public regarding roadblocks to receiving tertiary care at institutions such as Health City. There are times when patients are being sent overseas when quality tertiary care is available locally - at less cost to Government and to families.

And so Government will develop a new working arrangement with Health City, and with other medical facilities, to ensure that more Caymanians insured through CINICO can benefit from the high-quality healthcare they provide.

At the same time, our own medical services offered through the Health Services Authority must not only be of a high standard but must be run efficiently. The Auditor General’s Report on the Cayman Islands Health System, along with their health industry survey, provides useful insight into the state of local healthcare - what we are doing well and where there are challenges. Improving the efficiency and effectiveness of our healthcare system will require a long term, strategic change. A first step will be to talk with the industry players, including those at the HSA to determine what reforms are needed, and to devise new working arrangements that will catalyse the changes we need to see and perhaps identify what services should be focused on in future years. In terms of procurement, work has already begun to reduce costs with the use of the reverse auction system to purchase pharmaceuticals and medical supplies. To date the savings are substantial, at a projected 32 per cent of the cost, compared to using traditional procurement methods.

The needs of those suffering mental health problems will not be neglected. The previous Administration began work on a new long-term mental health facility, and this Government continues that work. We recently appointed architects to design the facility, which will enable us to treat people here closer to their families and communities rather than sending them at great cost to America or Jamaica.

More needs to be done to prevent health problems arising in the first place. Too many people in our communities are dying prematurely or have to live with long-term preventable conditions. The Government will renew its efforts in public health programmes and promote healthy lifestyles among our people. But perhaps the best opportunities for change lie with teaching our children at an early age the value of healthy food choices and a love for physical activity.

The Government will also make it a priority to ensure that Caymanians access appropriate health insurance at a fair price. This was an election campaign promise of ours and I know it has been a concern for many of us in and outside this House. It is thought that the insurance market does not function fairly, with too many Caymanians still unable to receive affordable insurance cover because of pre-existing conditions, and with senior citizens in particular unable to afford premiums after they retire, if they are even able to get insurance. Many are forced to seek to be declared as indigent to receive assistance from CINICO. In short, those who need it most are being priced out of insurance coverage.

We believe that part of the solution will be for the role of CINICO to be broadened as part of a reform of the insurance market. At the moment it falls to CINICO to

cover those who are unable to afford private insurance cover – essentially with Government picking up the full cost. This is unsustainable and we will look at how best to position CINICO to provide insurance cover to a broader demographic that includes younger and healthier persons so as to lower the overall costs to the public purse. The Finance Minister spoke about CINICO in his presentation, and he noted the increasing cost of CINICO premiums - in large part due to Government providing insurance cover to the market segment that the private sector will not serve.

Our sixth strategic objective is to create stronger communities and to support the most vulnerable in our society. As I have said publicly very recently, some of the programmes we have put in place to support vulnerable people fail them. Our social services and welfare programmes are inefficient and the programmes, as well as the agencies that deliver them, need reform. In short, Mr. Speaker, we need to ensure that we get the right help to the right people at the right time. Following the critical Auditor General’s report on welfare programmes in 2015, the last Administration committed to a programme of changes to help meet that objective. The successful implementation of that programme will be one of the key priorities of this new Administration.

I have only recently, as Minister for Community Affairs, received the Outline Business Case on the Proposed Modernisation of Social Assistance Programmes and discussed the broad proposals with my chief officer. My Caucus and Cabinet will review the recommendations in the OBC over the next few months as we prepare for the detailed budget plans. I can confirm that we will address the concerns of the effectiveness of the Needs Assessment Unit as well as improve the speed at which landlords and others who provide services to our social services agencies receive payment. Both of these are major areas of complaint and we will correct them.

Whilst I appreciate the concern and desire for Government to construct or purchase housing to be used for temporary accommodations by Social Services, the fact is that approach is not only impractical and cannot be afforded in this budget, but is also unnecessary. There is more than sufficient housing stock available in the private sector and Government would be robbing landlords by going into competition with them – the issue that landlords have is with receiving payment in a timely manner as well as concerns about damage caused to their property. By ensuring that rent payments are received on time, and that they are treated fairly regarding damages, then we can largely solve the issue without government taking on the burden of owning an estate of houses with the ongoing operating costs. The approach we are taking is affordable and practical.

As with individuals, some communities need more help than others. So our plans are to introduce an Urban Development Commission to help improve the quality of life in disadvantaged communities where more help is required. This will initially be part of the George Town Revitalisation initiative but will eventually be expanded to communities across all districts that also need help.

One of the key expressions of community, Mr. Speaker, is culture and heritage. In the Cayman Islands we have a culture and heritage to be proud of. The last Administration consulted widely on the development of a National Culture Policy. This Government will pick up the challenge of its implementation. We will promote culture and heritage in schools and to guest workers; we will celebrate with cultural festivals that attract locals and visitors alike; and we will promote the work of our artists and crafts persons.

I spoke at length about this Government’s commitment to the education of our young people. We are equally committed to enhancing their life chances more broadly through community activity and through sport. Community facilities will be encouraged and we will ensure that these are well maintained to enable participation. Where we have athletes with potential to attain elite status we will support them to fulfil their potential.

Similarly, older persons deserve our respect and thanks and, where necessary, our support. Again, the last Administration put the foundations in place with the long-term ambitions set out in the Older Persons’ Policy. Plans for its implementation are well advanced and will be taken up by this Government.

For those who need residential care, this Government will continue to support the Pines Retirement Home, Sunrise Cottage, Golden Age Home and Kirkconnell Rest Home.

Our seventh strategic objective is to ensure Caymanians benefit from a healthy environment.

These three Cayman Islands remain a very special place to all who live and visit here. Part of what makes us so special is our sea, sand and sunshine combined with our unique flora and fauna. We have a responsibility to this and future generations of Caymanians to do what we can to protect and manage our marine, natural and built environments. This is why, in the last Administration, we passed a comprehensive National Conservation Law, purchased land near Smith’s Barcadere and also began the work to review our marine parks.

We remain committed to protecting our environment, but we must also ensure that we get the balance right between preserving our environment and the need to responsibly develop our Islands to help provide employment and opportunities for our people. We will continue to support the environment but we cannot ignore some tension that exists between allowing necessary responsible development and protection of our environment – particularly following the passage of the National Conservation Law. As an example, we are being told that going forward almost every new government road will require some form of Environmental Impact Assessment - increasing the cost as well as the timeliness of completing necessary roads. Truth be told this tension has always been there – and perhaps in the past too often development has won over protecting the environment. However, both aims are important and need to co-exist, with Cabinet receiving proper advice and having the ability to mediate or decide in cases where a side must be chosen. And so, we will look again at the National Conservation Law to determine what amendments need to be made to ensure the proper balance is struck.

Central to our efforts to protect our environment we will continue to move towards more sustainable energy production and usage, including by CUC. We will encourage green energy through the increased use of solar panels and other forms of renewable energy across all three Islands, including at Government facilities. Getting this right will also help create new jobs in green industries. Our plans around sustainable energy were set out in the National Energy Policy, which was passed during our last Administration.

And speaking of green, we intend to put in place an ongoing programme for the eradication of the green iguana. Whatever form this programme takes it will not be like that last carried out by DoE, which included some form of lottery. We will also broaden the programme for the eradication of the Aedes Aegypti mosquito island wide with the continued assistance of Oxitec.

There are specific needs on the Sister Islands to which we will respond. The landfill will be closed and we will continue to build infrastructure to deliver piped water throughout Cayman Brac. Work continues on the multi-purpose centre on the Bluff as well as at the sports facility on the Bluff.

We will implement the new integrated solid waste management strategy developed under the last Administration. This will involve new infrastructure including a waste to energy plant and recycling and composting facilities. The remediation work on the existing landfill will start in 2018 and it will be closed when the new facilities come on stream. This implementation of the new waste management system will dramatically reduce the need for the landfill and so will resolve once and for all the question that has vexed successive governments of these Islands - what do we do with the dump.

The Government is committed to maintaining beach access rights and to creating more public open spaces. Programmes to safeguard land either through planning restrictions or through purchase by the government (utilising the environmental fund where appropriate) will be implemented.

Another environmental infrastructure requirement is reflected in this Government’s commitment to ensure there is sufficient cemetery space available to meet the future needs of the country. I am happy to advise you Mr. Speaker that this includes a much needed cemetery for West Bay – another promise that we both campaigned on, as did the Minister for Financial Services, who is the member for West Bay South.

The seven strategic objectives I have outlined so far are all outward facing, focusing our attention on the outcomes we wish to achieve for the country and its people. Our eighth objective recognises our own responsibilities to ensure the effective governance of our Islands through stable, effective and accountable government.

The last Administration restored sound public finances and moved us to compliance with the requirements of the Public Management and Finance Law. This Government will maintain that record of compliance.

I want to note that this SPS was prepared on the basis of four fundamental principles that underpin this Government’s fiscal policy with a number of objectives in mind, including:

1) It must provide significant surpluses;2) It must not include any new debt or taxes3) It must repay at least half of the bullet bond in 20194) And it must be affordable and fully comply with the Framework for Fiscal Responsibility set out in the PMFL.

By committing to economic growth, we will grow government revenues and in parallel we will challenge the civil service to deliver efficiencies to reduce costs – essentially growing our revenues and managing our costs. This approach will enable the investment needed to provide for the priorities I have highlighted today. And healthy surpluses will also mean that we can maintain the necessary cash reserves and have funds for capital projects.

We expect that with sound management of our finances we will be able to repay half of the US$312M bullet bond in 2019 while our excellent financial position generates a credit rating that ensures we can refinance the balance on favourable terms.

The E-Government programme, which we began to implement in the last term, is being rolled out and will deliver improved access to more responsive public services while achieving considerable efficiencies in their delivery. We will respond to our concerns over cyber security by enhancing the protection of government systems and data.

Finally, Mr. Speaker, I think that we, as political leaders, need to take responsibility for the fact that people feel disconnected from the political process and from their representatives. In the short term, this can create dissatisfaction with government. In the long run, it is dangerous for our society and our democracy.

As elected representatives we need to reconnect with our people and to enhance the democratic accountability of government. This government will do more to ensure a regular and effective flow of information between people and their elected representatives. We will look for new ways in which to encourage democratic engagement and participation and will deliver on the constitutional provision to establish district councils in each electoral district. This will require a review of the current District Councils Law to determine what changes are needed to make it relevant to the new single member constituency regime.

Accountability must not just be felt at district council level, Mr. Speaker. It must start with this government being willing to give a clear and transparent account to the people for its performance.

The SPS we are putting forward to the House today only sets a framework. I have demonstrated today that this is a government with ambition and I have underlined our willingness both to build on the success of the last Administration and to tackle some of the long-standing problems this country faces.

But as I said at the start, ambition is worthless if it is not matched by a determination to deliver. The SPS gives us a framework but it is over the next few weeks that we will establish the concrete targets we intend to achieve, and to devise the delivery plans that will get us there. It is the task of the budget process, which the SPS kicks off, to allocate government’s resources against those delivery plans to enable us to realise our ambitions.

All that is for the future. The first step in achieving our ambitions for the future of our country is to pass the Motion before the House today to support the SPS that the Honourable Minister of Finance has tabled.

Mr. Speaker I commend this Motion to the House and encourage all members to approve the SPS presented by the Minister for Finance as the broad parameters for the development of the 2018-2019 budget for the Cayman Islands Government.

Cayman Alternative Investment Summit - Premi...

Feb 21, 2017

Cayman Alternative Investment Summit - Premier Remarks

It is an honour and a privilege to join you again for this annual Cayman Alternative Investment Summit.

I thank Chris Duggan and the Dart organization for once more inviting me to briefly comment on the state of the Cayman economy and more generally, about how things are going in Cayman.

I also bring a warm welcome from myself and the Government. For those visiting the Cayman Islands, please do step beyond the confines of the warm hospitality of this venue or whatever hotel you are staying at and experience more of what Cayman and our people have to offer.

My interest is piqued each year as this Summit gathers to discuss what I have always found to be interesting themes.

This year the theme under consideration is Defying Gravity: The Future of Alternative Investments in Exceptional Times. Last year’s theme spoke to “an age of uncertainty”.

I am not certain whether the use of “Exceptional Times” is merely a euphemism for “an age of uncertainty” or whether the promotors of this conference are actually daring to allow for an element of optimism to be contemplated this year. Frankly, I’m not sure there is much of a distinction.

President Trump was elected on the promise of radical change and four weeks into his term, his approach to politics and governance would tend to suggest that indeed we are living in both an age of uncertainty and in exceptional times.

The impact of his administration and its yet to be articulated policies with respect to jurisdictions such as Cayman is still very much in question. But there can be little doubt that an unpredictable future is ahead.

My recent visit to London to discuss with UK ministers the implications of Brexit for Cayman has left me feeling positive that the UK is indeed listening to our concerns and will take them onboard during its continuing discussions and negotiations with the EU. It is still very early days yet but it is obvious in speaking with UK officials that, for the most part, they are viewing Brexit as the glass half full. In fact, some believe Brexit will allow the UK to fill the glass even more. There is an acceptance and a determination to move towards what Prime Minister Theresa May refers to as the new Global Britain. Indeed, when I and other Overseas Territories leaders paid a courtesy call on the Prime Minister last week she reiterated her plans for the UK’s new place in the world and strove to assure us of the importance of the Cayman Islands and other Overseas Territories to the British family. This is promising for the OTs and particularly for Cayman.

My own view regardless of whatever times we are in can be summed up by words borrowed from the author William Arthur Ward - who said “the pessimist complains about the wind, the optimist expects it to change, the realist adjusts the sails”.

In 2013 when my administration took office, we readjusted our sails and the success of these Islands since then bears testament to our solid, planned approach to governing. Back then, we had a stagnant economy, government finances were in the doldrums, business confidence in Government was at an all-time low, investment in Cayman was stymied, the relationship with the UK was almost non-existent and Caymanian unemployment was at an all-time high.

In moving from where we were, to where we are today, we have defied ‘the economic gravity of the time’ and so now have an economy that is by far the best in the region.

Looking around at other Caribbean economies one quickly sees that Cayman has avoided the ravages of spiraling debt, unsustainable deficits, high unemployment and economic stagnation. To the contrary, we have grown our economy, reduced unemployment, accumulated fiscal surpluses, paid down debt and are seeking to pay down more debt early. And we are forging ahead with necessary infrastructure projects, including modernizing our airport and road network and building a modern waste management facility that includes recycling and waste to energy; all without adding any new debt or introducing new taxes. In fact, we have reduced taxes and fees.

In the words of RBC economist for the Caribbean, Marla Dukharan, Cayman is doing what she termed a “fantastic job”. She spoke in this very same room at a recent conference.

To quote her, “This is the best run economy in the entire Caribbean. You should have a conference here and invite all the ministers of finance from around the Caribbean and tell them how to run a country because there is a lot they can learn.”

Indeed. Despite 6.3% negative growth in GDP in 2009, Cayman has had positive growth for the past six consecutive years. Growth during the past three years in particular has certainly ramped up; from 1.5% in 2013 to a forecast high of 3% in 2016.

Cayman’s success in a strong economy is because when our Government spends, it does so to support our economy.

Again, quoting Ms Dukharan, “When other governments spend, it does not support their economies. It supports the economies of China and the US and whoever else they import from.”

Ms Dukharan told us that Cayman has the lowest level of poverty in the Caribbean, but that Cayman’s inequality in that regard is different because the lowest income earners are largely expatriate workers.

Again, quoting from Ms Dukharan, “The thing is, you need them. “The Cayman Islands needs that kind of labour to be the world-class destination that it is.”

Under this Government’s watch, there is less than 4% overall unemployment - looking at the entire workforce of employed Caymanians as well as those on work permit or those who have residency with a right to work. It is the lowest unemployment in the Caribbean. And with the growth in the economy over the past four years, employment of Caymanians has grown as well and Caymanian unemployment levels have fallen from 10.5% in 2012 to 5.6% last year.

Many of those jobs are in the tourism sector where stayover tourism arrivals hit record levels again in 2016.There were close to 386,000 tourists who arrived by air last year. Cruise numbers have increased tremendously over the past three years and were stable last year with 1.7M visitors. These numbers are back to levels not seen in Cayman since 2007.

Over in the financial services sector there are areas that are performing better than others but we are very focused on not only protecting this key sector, but to providing the industry with new products or legislation that can not only defend it from attack but to also provide new areas and markets for growth.

Again, quoting Ms Dukharan about the financial services industry, “Cayman is the most stable and least vulnerable in the Caribbean.”

All this has not occurred by chance but because of the work done by my administration and businesses over the past four years to grow the economy. And I would say the Dart organization is a leader in this regard.

And I would again say that over the course of this term we have introduced no new debt or new taxes. In fact, we have reduced taxes and fees as well as reduced debt. And we have plans to continue to repay debt, including repaying in its entirety a US$312M bullet bond taken out in 2009 that falls due in 2019. We are completely on track to do this. We have defied gravity.

I would add that our policy of reducing taxes and fees as we increased surpluses through better money management has meant that we have put more than $22M a year back into the pockets of businesses and families.

And we have squirrelled away sufficient reserves to finance over six months of Government expenses in the event we see another global recession with a falloff in revenues as we did in 2009.

There has been no other administration in the history of these Islands that has come close to this achievement. My administration subscribes to the principle that the only true independence is financial independence.

My Government is ambitious for the future of Cayman, Caymanians and all who live, work and invest here. Over the course of this term we have restored investor confidence, restored economic growth, restored job growth, restored the relationship with the UK, restored Government finances and tackled needed infrastructure projects. Infrastructure that is needed to not only provide facilities for our people but that is vital to protect the environment and to support economic growth on the social side. We have also introduced a minimum wage regime and are making strides to improve our education system and addressing teacher pay as well as school infrastructure and tackled pay increases in the public service.

And we have only just begun.

My Government has laid the foundation for continued growth in our economy so that our people have opportunities for jobs or to start up their own businesses. We firmly believe in the tenet that the best social welfare system is the ability to have a good job. As we close out our term with the elections here in May, I remain ambitious for Cayman, and I have confidence that the voting public will see the definitive progress we have made.

We have certainly come a long way in almost four years because of the work of this Administration and our partnership with business community. In the midst of political, social and economic turmoil globally our three small Islands have performed remarkably well over the course of this political term. We have defied gravity and we have done it in exceptional times.

So as you deliberate on The Future of Alternative Investments in exceptional times, I encourage you to consider the opportunities available to invest in the Cayman Islands. And I hope that those of you visiting us will return and bring your families and friends to see up close what makes Cayman the jewel of the Caribbean.

In closing I note that later on today you will hear from keynote speaker Arnold Schwarzenegger. I welcome Arnold to the Cayman Islands. As a youngster I once aspired to be a body building star myself. And I confess Arnold and Lou Ferrigno were my heroes.

And despite what some of you may think, I believe Arnold is doing a very job on the Apprentice TV show.

I have never hosted a television show myself but Arnold and I do have at least one thing in common. As a former California Governor he, like me, understands what it takes to win an election and to govern.

And so recognizing our elections in May this year, I cannot resist borrowing a line from Arnold – “I’ll be back”.

Oct 19, 2016

2016 Chamber Luncheon Premier Speech

Oct 19, 2016

2016 Chamber Luncheon Premier Speech

When I first addressed the Chamber Legislative Luncheon back in September 2013, I commented on the importance of a genuine partnership between Government and private enterprise. I also said a respectful and genuine partnership is required if government and private enterprise are to achieve mutual goals. And indeed this Administration and the Chamber have worked together in partnership in many areas over the course of the term.

At times the relationship has been better than at others, but the partnership has never been in question. We have agreed to disagree on occasion but both Government and the Chamber understand that the partnership is of critical importance to the continued prosperity of these Islands and our people.

Business cannot prosper if the country does not prosper. And the country will not prosper if business does not do well.

I have always believed this. And my time as Premier has underscored this to me.

I also believe that for a partnership to work, all sides must not only work together but also listen to the other views and perspectives.

So with that said President Paul, I wish to thank you for your comments earlier – I know that they are meant in the spirit of partnership. And I trust that what I have to say on behalf of Government will be taken in that very same spirit of partnership.

We know that the cost of doing business is always prominent among the concerns of the Chamber. And I am happy to say this Administration has worked hard to address this. We started by cutting the fuel duty charged to CUC from 75 cents per gallon to 25 cents per gallon, thereby lowering the cost of electricity bills. This has reduced government revenue but has had the advantage of leaving some $17M in the pockets a year of individuals and businesses annually.

We also reduced the duty paid by licensed traders from 22 per cent to 20 per cent. This cost Government $4M annually in lost revenues but also reduced the import duty costs to businesses and has allowed them the ability to provide better pricing to local customers.

We significantly reduced Government fees for small businesses and have forgiven those businesses that may have fallen behind on their fees, provided they pay the current fee to reinstate them. Once this is done these businesses once again become eligible to bid on government contracts.

No new fees and taxes 4 budgets in a row! There has never been another administration that has gone a full term without increasing fees and taxes but instead has reduced them. But we have done so. And as the economy improves we will look again at what taxes or fees can be further reduced. So, while I acknowledge the continued concern about the cost of doing business, I believe that everyone will agree that this Administration has done a significant amount to address this issue.

And finally, on this point , I should say that we have done this while still managing to give the Civil Service a much deserved cost of living increase as well as an ex-gratia payment in 2 of the previous budget years. This is additional money that they have available to spend in the local economy.

I can certainly say the business community has been saying to us that Cayman is in a much better place than it was four years ago. Some in this room have even reminded me of a pre-election survey that the Chamber did of its members in February 2013, 3 months prior to the last elections.

Some 92 per cent of the 254 businesses that responded to that survey said they were not satisfied with the way things were going in the Cayman Islands at that time.

This was reflected in the pre-election survey results where the main concern of businesses was a lack of confidence in the competency of the then government. Our detractors have said and continue to say lots of uncharitable things about us, but even they have not seriously questioned this Government’s competence or integrity.

Other top concerns of Chamber members back then included the country’s finances and the economy as well as social issues. These are issues that we have worked hard to correct.

I believe that when the Chamber does its next election survey the results will show a much more positive outlook. I say this with confidence because the economy has improved, businesses are doing well and our people are getting back to work again.

I will not be shy about saying this; we are at this point because of the efforts and ability of the team I lead. Our policies and key decisions have worked to improve the economy and have created an environment for businesses to thrive and for everyday people to have opportunities to improve the lives of their families. Make no mistake about it. Elections do matter. The people you choose to form your government do make a difference to the fortunes of the country, for better or worse.

The success that we have enjoyed does not just come down to competence. This Government understands the value of teamwork, hard work and the importance of sticking to an agreed plan and agreed principles.

There is no secret that we have had our share of challenges. The fact that 3 members of the original team deserted the government benches over the course of the last year posed a serious threat to the stability of the government. But we persevered and weathered the storm. Each of us that remained took on greater responsibility and, indeed, as the record shows, we are delivering on our mandate.

The 10 of us who currently make up the government are committed to continuing to provide this country with good honest and capable leadership. We understand that politics is both the art of the possible and the art of compromise. To succeed as a government we understand that there has to be give and take; that you must have the maturity to disagree on issues but still be able to continue to work together in the best interest of the country. There is no room for selfish, narrow-minded thinking when you are running a country.

You in this room are business people so you understand well the importance of organisation, cooperation and teamwork; of having goals and plans and the ability to execute them.

I acknowledge full well that there is more work to be done over the remaining months of this term but we are moving forward. We have laid a solid foundation for a brighter future for these Islands. And we will fight hard for the opportunity to return to office and build on the work of another term.

After which I will retire to my farm and the bush in East End, worn-out but contented.

But however hard-fought the upcoming elections in Cayman will be, I certainly hope that it is nowhere near as crazy as these upcoming US elections.

All I have to say is that there is only one redeeming thing about the Donald and Hillary Show. On November 8 it will be over at sundown. And let everybody pray that there are no hanging chads – for we could not go through this thing again. We need to get our TV back.

But I digress.

At the start our term in 2013 we understood that we faced several challenges, not least of which was an economy in stagnation; a stagnation that had at its root the lack of confidence in Government that I mentioned earlier; a stagnation where businesses were hesitant to invest. There was also rancour with the UK over good governance issues. Unemployment was at the highest it had been for decades and families and small businesses were under increased stress.

We understood very well from Day One that, as Winston Churchill said, “The problems of victory are more agreeable than those of defeat, but they are no less difficult.”

So we were prepared for the challenges. And we set out with ambitious plans for these Islands. Plans to: Restore confidence in Cayman and in Government;

Strengthen the economy; Stabilise Government finances; Reduce the tax burden where practical; And improve employment and opportunities for our people.

Over these three- and a-half-years we have worked tirelessly to bring about a recovery of Cayman that has been so successful it has been recognised in the UK, in the region, and elsewhere.

We put in place a credible but challenging plan to restore government finances over a sensible three-year period. And we have been extremely disciplined in carrying out our plans.

Our last three budgets have generated net surpluses, including the results of the Statutory Authorities and Government Companies, totalling $395M. We did this despite giving up tens of millions annually in tax reductions and in correcting inequalities in civil servants’ salaries and more. All of which has put over $30M annually back into the economy. By comparison, the UDP’s last three budgets created net surpluses totalling only $40M.

When we were elected the country’s total debt stood at about $574M. Over the past three years we have reduced debt by $71M, to $503M as at the end of the last fiscal year. By December 31, 2017, under current plans, debt will be further reduced by $52M, to $451M. And so far we have set aside $18M in a debt service sinking fund, which can be used to repay debt in future years as needed.

The debt service ratio at the end of the last fiscal year was below the 10 per cent prescribed by the PMFL, and with our no new borrowing and debt reduction policies we intend to keep it there.

No other country in our region and few countries in the world, regardless of size, can match this.

We have also put aside money and rebuilt our cash reserves and, as at the end of September this year, we are able to fund 199 days – that’s over six months or $314M, of Government’s estimated operating expenses; an important cushion for the uncertainties of the economies of the modern world.

And as you know we have met all the targets required under the Public Management and Finance Law and going forward the United Kingdom will not need to pre-approve Government’s budgets.

I have to thank Minister Archer and his team for the fine work they do in the Finance Ministry. But I also give thanks to my entire team, who though they rightly fight their corner for their ministry’s share of the budget, also step up and compromise when needed.

I have to point out, in case you some of you missed it, that this Government now has two Ministers who have been internationally recognised for their work. The Deputy Premier was acknowledged last year as Tourism Minister of the Year for the Caribbean for his sterling work in growing our tourism numbers and championing improvements to our airports and seaports.

And Minister Archer was recently named 2016 Finance Minister of the year for the Caribbean by Global Markets magazine. In announcing the award the magazine quoted RBC’s Caribbean economist, Marla Dukharan, who said the achievement in restoring Cayman’s finances, reducing debt, and growing the economy was impressive.

But what Ms Dukharan could have also noted was that these impressive improvements to Government finances and to Cayman’s economy were done with no new taxes, no new borrowing, with government operating from a cash position and without use of an overdraft.

In fact we have not used an overdraft since we cancelled that facility three budgets ago.

So operating costs are being met from available resources - we are spending what we have. And we have managed government finances in a manner that ensures we do have the necessary funds available.

Capital improvements are also being funded from available cash, with no new borrowing, including funding for key projects such as:

Continuation of the John Gray High School; On-going road network upgrades and expansions including Linford Pierson Highway; Work on a new residential mental health facility; and The purchase of lands for national conservation, including the property next to Smith Barcadere.

Other key government projects under way include:

The Owen Roberts International Airport where Phase I of redevelopment has been completed. Construction of Phase II and expansion of the terminal has been awarded to McAlpine Ltd. The project is due for completion in summer 2018.

Work on a modern cruise berthing and cargo port continues to progress.

Baird, which completed the Environmental Impact Assessment and conceptual design, provided a draft report of alternative layouts for the facility that repositions the piers into deeper water and reduces dredging and environmental impact and accommodates four of the largest class of cruise vessels.

The Ministry issued a request for proposals for firms to conduct civil engineering design works for the proposed cruise berthing facility. The tender was awarded to Royal Haskoning DHV.

The contractor prequalification process is projected for December this year or January next and the tender process for construction is projected for March 2017.

Preliminary work to create a boardwalk and seaside park in South Sound has begun and will be completed by the end of this year. And with the purchase of the property next to Smith Barcadere we will create a Smith Barcadere beach and park experience. When complete both the South Sound seaside park and the Smith Barcadere beach park will become invaluable family spaces.

We are committed to preserving other sites as well, such as Point of Sand property on Little Cayman. Preserving lands for public use, along with the passing of the National Conservation Law, are an important part of our efforts to preserve our heritage and environment. We are business friendly but we are also an environment friendly Government. The key is to strike the right balance between encouraging needed business and protecting our environment. I believe that we have done well in this regard.

Work to develop a modern Waste Management system has reached a key milestone with the Outline Business Case being completed and put out for public consultation. It is expected that a request for proposals for a private sector partner will be published in the coming months with a contract to be awarded before the elections in May. I can also confirm that sources of funding are being identified to meet government’s financial contribution to the project over the course of the next 25 years.

The solution will include a waste-to-energy plant that, along with recycling of the tyres at the dump, enhancing recycling generally and the creation of a composting facility, will reduce the amount of refuse going into the landfill by an estimated 95 per cent of what it is today.

This government remains committed to doing what must be done for the long term health and viability of the country, including bringing about a proper integrated solid waste management facility.

Operating a proper waste management facility creates opportunities for many more jobs, including engineering jobs, than those available by merely operating a landfill. So while there will be costs associated with such a facility, there are opportunities for private sector involvement and creation of new jobs for our people.

And on the health front we have also been proactive in fighting threats such as Zika - using money, people, science and technology in seeking to eradicate the Aedis Aegypti mosquito, which carries diseases that threaten our health and economy.

As we get ready to send out an RFP for a new waste management facility, the Legislative Assembly has this week approved a second reading of the Procurement Bill (2016), which sets up an improved and transparent tendering process for public bids for anything from purchasing supplies to the construction of public buildings. Also included is the ability to use a variety of tendering processes including innovative electronic reverse auctions.

As I have said many times, President Paul – we are a Government that gets things done. But we are also a government that has worked to return good governance to the business of governing by practicing it; not just talking about it.

The result of all of this is that confidence in Cayman has returned. Investors and businesses have learned that they can trust this Government to keep its word and get things done. This renewed confidence has led to local businesses expanding, new businesses starting up, and several major new projects being planned and in the works. At least in part, the reason for the challenges at Immigration and Planning is the sheer number of applications. Work permits are at an all-time high and Planning applications are at an all-time high.

And with increased economic activity, since our taking office, Cayman’s GDP has grown on average by 2 per cent annually. This is far better than the negligible growth under the previous administration. And the most recent indicators show a rise of GDP by 2.4 per cent during the first quarter of this year. So we are poised for even more growth. This is obvious as you drive throughout these Islands.

The development sector is doing very well with projects of all sizes under way. Since May of last year the Planning Department has processed well over 1,200 planning applications with project values totalling in excess of $800M in Cayman dollars.

Just last month the NCB Group broke ground on Tides, a $33M residential development - their third major development in as many years. This is a good indicator of the confidence in Cayman that businesses have since this Government was elected. There are other exciting development projects on the way such as Vela and Fin. The Arnold Palmer golf course at Ironwood Development in North Side is also expected to begin soon.

Other ongoing projects include the Kimpton and Margaritaville, which will provide additional room stock, in different market segments, to support our growing tourism numbers.

Dart has announced plans to build another resort that, when complete, will create unique experiences for tourists and residents.

I am happy to say Dart is also working with Government to add 2 additional lanes to the Esterley Tibbetts Highway as agreed in the third amendment to the NRA Agreement, which we negotiated and signed earlier this year. That agreement also removed the sharing of tourist room taxes with Dart, which was a feature of the previous agreement. Tourist arrivals by air are at record numbers, with about 383,000 visitors arriving in 2014 and 385,000 in 2015. These are the highest air arrivals in more than two decades. So far this year arrivals are doing well, with 282,000 visitors by the end of August.

Cruise arrivals also tell a good story, with about 1.61 million cruise visitors in 2014 and 1.72 million in 2015. These are the best numbers for cruise arrivals since 2006. The cruise numbers for 2016 are off to a good start with 1.2 million arrivals in the first 8 months of the year and we are expecting to end the year with more arrivals than in 2015. With increasing air arrivals, Cayman Airways announced plans to modernise its fleet. Next month CAL expects to add a Boeing 737-800 aircraft. This will serve as a bridge to the airline’s new 737-8 Max aircrafts that will be delivered between 2018 and 2020. CAL will also add a second SAAB and will possibly use it beyond the Cayman Brac route to new regional routes such as Montego Bay. Plans are also being advanced to fly into Roatan, Honduras, starting in February 2017.

Financial services and company registration continues to do well, and recent legislation has helped not only enhance the sector’s ability to meet global compliance standards but also to be more competitive with product offerings. This includes the Limited Liability Company Law as well as improvements to our copyright, patents and trademarks regime.

This Government has tackled several issues that past governments have not had the political will or fortitude to take on; one being the modernisation of the Legal Practitioners Law. Although we have deferred the bill to the next meeting of the House in January in order to give interested parties more time to consider the bill and make

representations to Government, I want to assure all concerned that this Government is determined to pass a modern, effective law to bring the regulation of legal practice in the Cayman Islands into the 21st Century.

And as the economy has improved so have employment opportunities for our people. In fact Caymanian unemployment has fallen from a high of 10.5 per cent in 2012, (with about 1,925 persons being unemployed), to a low of 5.7 per cent, (or about 1,100 persons), in spring 2016. Underemployment has also fallen over the past year.

That means more Caymanians are employed and working the hours they need to.

But we are not - indeed we cannot be - satisfied until every Caymanian willing and able to work has an opportunity to do so. Being Caymanian is not an automatic qualification for a job. But certainly every Caymanian who is willing and able to do a job must have the opportunity to get employment.

We know that the best social programme is a good job.

We have engaged Government agencies and the private sector to assist Caymanians, especially those challenged with maintaining employment, to receive the help and mentorship needed. And programmes such as Ready-2-Work Cayman are making a difference and achieving success.

President Paul you and some others in this room have played an important role in making this successful. I thank my Ready-2-Work Task Force Co-Chair Woody Foster and all task force members and civil servants for the hard work they have put into this project.

I also thank all the businesses involved. But we need more businesses to play a part so that we can have the best opportunities to match individuals to businesses with jobs for which they are best suited.

The Hospitality School was restarted under this Administration and is a joint venture between Government, UCCI and tourism partners. This year we have some 40 students learning the hospitality business and getting first-hand experience working alongside professionals in the industry.

Just today we concluded debate on the long-awaited Education Bill. When it comes in to effect next month, the law will establish modern legislative and administrative frameworks for our public education system. Our goal is to ensure the education system is well suited to prepare our children for jobs and opportunities.

And a few months ago Cabinet dedicated a further $3.2M to Education’s 2016-2017 budget for an overall expenditure of almost $150.6M. This is the second largest item in this Government’s budget, second only to national security. This is a good indicator of the priority we place on the education of our youth.

We also recognise that small businesses are key job creators and we have greatly reduced fees for small businesses. The number of small businesses being started has doubled since this initiative was created and I trust many of them have become members of the Chamber.

Jobs are important to families but so is the ability to make a dollar stretch. The reductions we made to taxes have helped to reduce the cost of living.

Additionally we expect that the soon to be created Utility Regulation and Competition Office will greatly assist in ensuring that the utility and fuels sectors operate competitively and indeed fairly – removing all doubts regarding the possibilities of overcharging.

The Consumer Price Index has fallen consistently since 2015. The most recent survey indicates that it has fallen again by 2.8 per cent in March 2016 compared to March 2015.

Undoubtedly, decreasing oil prices are helping drive this, but decreases have also been aided by the reductions in import duty on consumable goods and on the diesel used by Caribbean Utilities Company to generate electricity. This has also lowered the cost of desalinated water production. These tax decreases have also helped reduce the cost of doing business.

We also encourage importers to source quality food at the most affordable prices. So we have been in on-going discussions with the Government of Honduras with regards to creating opportunities for local merchants to import goods directly from Honduras rather than having them first go to Miami before being sent to Cayman, driving up food costs.

This Government has also placed a renewed focus on the local production of quality livestock and produce. So much so that the Cayman Islands will become the first Overseas Territory to host the Caribbean Week of Agriculture conference next week, from 24-28 October, with about 25 countries attending. Locally produced food also provides a healthier option for people.

Speaking of health, we are hosting the 2016 Cayman Islands Healthcare Conference from tomorrow through Saturday with a focus on “The Chapters of a Healthy Life”.

Conferences such as these not only provide useful information and networking opportunities for local residents, but also add to visitor tourism numbers.

So overall we are indeed in a much better place than we were four years ago and Cayman has seen a remarkable economic recovery.

But we have also worked to make the lives of people better by passing important legislation and amendments to legislation.

Some of the laws that will positively affect people’s lives include a national minimum wage to help ensure that some of the most vulnerable in our community can earn a reasonable wage.

We have also increased the retirement age from 60 to 65 in the private and public sectors to assist individuals who are able, willing and may need to work longer.

The recently passed Disabilities (Solomon Webster) Law helps ensure that people with disabilities are treated with respect and dignity.

We also legalised medical cannabis oil to aid those suffering from disabling diseases, such as cancer and epilepsy.

The Criminal Records (Spent Convictions) Law was passed to allow for certain convictions to be expunged after a number of crime-free years. This will help many ex-offenders in our community who have lived crime-free lives to more readily find gainful employment and to be able to travel overseas.

By now I am sure you are getting a picture of just how much Cayman has recovered and how much this Government has achieved in just 42 months. This Progressives-led Government is a Government that gets things done.

And some of the other things that we are getting done include: George Town revitalisation project and road improvements; Upgraded the Charles Kirkconnell airport to international airport status;

Improving the education system, reviewed the salaries of teachers and upgrading school facilities;

Introduced single member constituencies and one person one vote and necessary amendments to the Elections Law; Plans are under way for civil servants to contribute to their health care;

Passed a new Liquor Licensing Law and updated the Builders Law; Improved air service to and from both Cayman Brac and Little Cayman.

Add to this the 45 or more bills that will have been passed over the last two meetings of the Legislative Assembly and the myriad of other important bills passed over the last three years.

We have shown the willingness and ability to fight on the international stage to defend Cayman’s business model and reputation; whether at Chatham House in London, on BBC’s HardTalk, in Brussels where Minister Panton recently faced down a room full of unfriendly Members of the European Parliament, or more recently at the Anti-Corruption Summit in London. We will go where we need to fight the case for Cayman.

But much of the defending, negotiating and arguing our case occurs outside the public’s eye. When necessary we remind those on the other side of the table that we will not roll over and we will defend ourselves at all costs, even if going to the international courts if needed.

There are those on the opposition benches who believe that it is better to shout and stomp your feet and threaten. Me, I prefer firm diplomacy.

Successful negotiations with the United Kingdom on beneficial ownership and the positive outcome at the Anti- Corruption Summit underscore my point.

With all of this I am sure that you get a picture of a serious Government that gets some serious stuff done!

But this does not mean that there are not some issues that are more challenging and have no quick, easy solutions. One such is the recent ruling of the Grand Court that questioned certain aspects about the permanent residency points system and the process. The root of the issue goes back to systems and processes in place for many years but it has now fallen to this Administration to find a sensible resolution. This is a vexing issue, not just for those impacted, but for me and the Government. The matter is complex and we are working to address it. There is no sinister reason for the advice remaining confidential at this stage as some have suggested. It is simply the case that sensationalised reporting of the legal advice government has received on this sensitive issue is bound to make resolution of the issue that much more difficult and politically fraught.

Ironically, the relentless efforts of the Cayman Compass to obtain and publish the legal advice, which the government has received, has made it even more difficult for me to speak publicly about this matter at this stage. This is so because by doing so it may be claimed that we have waived the legal professional privilege, which we have asserted with respect to this advice.

The matter remains under consideration by the Government as we seek the best way to move forward. Until a resolution is found, all I can do is crave the patience of those awaiting their applications to be processed. The Government takes this matter most seriously and intends to deal with it as quickly and efficiently as we can. You will have already seen signs that the election campaign is starting. The next few months will certainly get interesting. But the focus must remain on the bright future that the Cayman Islands has with this Government leading the way.

As we look to the future here in the Cayman Islands, we are also watching the evolution of Brexit and what it will mean for Cayman. We will insist that as the Brexit negotiations move forward, the interests of the Overseas Territories will, as the UK indicated, be included in the considerations.

We are optimistic. In the sea of uncertainty that is Brexit, the Cayman Islands is an increasingly attractive place to live, work, invest and do business.

We intend to further these discussions about Brexit when we meet in November for the Joint Ministerial Council meeting in London.

The sound financial position of the Cayman Islands Government, and the growing strength of our economy, makes us an excellent option for businesses and investors looking for a safe haven amid the current political and economic turmoil throughout the world.

Our international financial services business remains strong and competitive and will continue to be a key economic pillar as we move forward. There are challenges, but both Government and the financial sector are prepared for them. The partnership between the sector and the Government remains strong.

Our tourism product continues to improve with existing properties undergoing upgrades and new upmarket hotel and condo projects are under way and these will enhance room stock allowing us to grow our tourism product even more. With our new airport and cruise and cargo ports projects we will be well placed to handle increasing visitors for many years to come.

When complete our new integrated solid waste management facilities will have finally fixed a huge environmental problem at the landfill. But with this new facility we will not only have fixed the dump as people urged us to do, we will ensure we never have this problem again.

I anticipate the George Town Revitalisation project, with the expanded roadworks, will blossom further with private sector partners making use of the legal and physical frameworks put in place by this Government to create a new and vibrant central George Town.

Our efforts to enhance education and provide training for Caymanians coupled with the growing economy will help ensure that our people are prepared for the new jobs being created.

And with the arrival of a new Commissioner of Police in November, we have an opportunity for a new outlook and partnership in crime prevention. In addition, if God and the people are willing I return to office as Premier, I plan to lead the charge for the creation of a Police Authority that would allow elected members input into matters of policy in respect to law enforcement. I expect this new relationship between lawmakers and the RCIPS will go a long way in providing better crime prevention outcomes.

This administration started our term with ambitious goals. And we remain ambitious for the future of our Islands and our people. We have accomplished much and have put in place the platform to achieve even more.

This is a government that does not plan in four-year terms, but for the long term. The key thing is that when we were elected we started on Day One with an agreed plan and goals. You do not accomplish what we have in a mere 42 months without a plan. And you do not accomplish what we have without hard work and teamwork.

I hope that the business sector and the country will bear this in mind come May next year. Elect those who can represent you in your constituencies by all means, but also remember that they must represent you nationally and internationally. Elect persons who can point to a plan and the others they say they will support and work with after the election.

There are those that walk and talk about the need to elect independent candidates, crowing that the party system has failed the country. I am not sure what party they are referring to, but in terms of this Government and the outcomes that we have obtained I think it is true to say that the party system can work.

I offer some advice for anyone who wants to run for office. Operating as a team with an agreed plan and set of principles must be a better way to run for office. Be transparent - tell the electorate what you stand for, who you stand with, and what you will do together if elected. Be truthful and say who you will support as Premier.

There are those who, based on their rhetoric, appear not to understand that the country will not prosper if business does not do well. And business cannot prosper if the country does not prosper.

There are some who appear to believe that shouting anti-business sentiment shows their nationalistic credentials.

I may have taken a few liberties as this is the last time I will address you during this term. But let me be clear, so you understand, whoever forms the next government must, as we have done, appreciate the symbiotic relationship between businesses and people.

It would be remiss of me in closing if I did not thank my very capable team, Ministers and Councillors as well as the Deputy Premier for their commitment to the cause, dedication, discipline and hard work. As I said before, we went into this knowing hard decisions had to be made because of the state of the country when we took office three-plus years ago.

I also thank the Governor for her constant support of the Government and me and her advice, Speaker of the Legislative Assembly as well as the Deputy Governor, Attorney General and Cabinet Secretary for their invaluable assistance. And to the wider public service that I have had the honour and pleasure to lead, I appreciate your hard work and look forward to working with you now and in the future to ensure the Cayman Islands remains the brightest jewel in the Caribbean Sea.

I also thank my team in the Office of the Premier for their hard work and dedication over these past three- and a-half- years. Your efforts have not only helped me, but have also aided the Government in getting its work done.

Lastly, I wish to extend my appreciation to President Paul, the Chamber Council and all members of the Chamber of Commerce for once again hosting this Legislative luncheon.

You have been a most gracious and attentive audience. I am honoured to have been afforded the opportunity to be with you here today. I hope you derived some benefit and some comfort from the few remarks I made here today.

Oct 04, 2016

Baroness Anelay Speech to the Legislative As...

Oct 04, 2016

Baroness Anelay Speech to the Legislative Assembly

It is indeed a delight to be here in the Cayman Islands and have this opportunity to speak to you. It is my first visit to an Overseas Territory since assuming responsibility for them in July this year. I couldn’t have chosen a more beautiful starting point. And yesterday I visited Little Cayman and Cayman Brac, and I saw for myself the stunning scenery, the enchanting wildlife and the impressive facilities that attract visitor after visitor.

I also met a number of local residents and experienced firsthand the ‘Cayman Kindness’ that I have read so much about. I would like to thank Premier McLaughlin and Deputy Premier Kirkconnell for their welcome, and all the other members of this Assembly who have given me such an excellent insight into life on the Sister Islands. When Premier McLaughlin and his team come to London next month for the Joint Ministerial Council meeting, I look forward to reciprocating your warm welcome.

We greatly value the JMC as an opportunity for all the Heads of the UK Overseas Territories and UK Ministers to meet and discuss areas of mutual concern and interest.

EU Referendum

A new item on the agenda this year will of course be the implications of the UK’s recent referendum result. As the UK prepares to leave the European Union, we are determined to forge a bold, new, positive role in the world. This will present opportunities, including for the Cayman Islands, and we will work closely with you to ensure that your interests are protected.

We will protect your interests because the United Kingdom and the Cayman Islands share a close bond, thanks to our common history, our linked economies, our shared values, and our personal ties. And of course our relationship isn’t preserved for posterity - it’s very much a modern relationship which is evolving with the times. The Cayman Islands themselves are changing too, thanks to a well-managed and strong economy.

Cayman Islands Economy

Your GDP is growing; employment is rising; debt levels are within target; and visitor numbers are up.

Of course your financial services sector is the driving force behind much of this impressive performance. As a leading international hub for pension fund investment and raising capital, the Cayman Islands bring real benefits to the global economy and onshore economies.

The UK and Cayman Island economies also enjoy mutual benefits from our respective financial services sectors. The expertise of the City of London and the financial services providers on this island are second to none.

The sector as a whole is often in the spotlight and a subject of discussion amongst world leaders, but the Cayman Islands’ track record of cooperation and transparency speaks for itself. The need to make changes to counter serious and organised crime has been embraced by your financial sector, with the support of the Cayman Islands Government.

We welcome this willingness to adapt in response to new and evolving challenges.

LGB&T

Today I would like to raise another issue in which we have seen gradual change in recent years. That issue is equal rights for all. In particular I would like to address the issue of equal rights for people from the Lesbian, Gay, Bisexual and Transgender communities.

I know this is a sensitive matter in the Cayman Islands, and has been the subject of much debate here. We had similar debates ourselves not very long ago, including in my own place of business, the House of Lords. It took some time for changes to equality legislation to be agreed in the UK - so I do understand the need for time, the need to reflect and to adjust. I have no wish to preach or lecture.

What I do want to do is to set out today the UK Government position and explain why I strongly believe that it is in everyone’s interests to ensure LGB&T equality and freedom from discrimination.

First, and most importantly, I want to make clear that the British Government has no plans, no plans to impose same-sex marriage in the Cayman Islands. However, I also want to be clear that continued discrimination puts the Cayman Islands in breach of its international obligations, so there is a legal imperative to change.

There is also an economic imperative. Evidence has shown that it is only when countries are able to draw on all their available talents, and make all their citizens feel included, that they can fulfil their true potential.

The people of the Cayman Islands are famous for offering a warm welcome to a diverse range of people from all over the world, whilst retaining their special Caymanian culture and heritage. I hope they can begin to offer the same welcome to their own LGB&T communities.

Civil cooperation

As I said earlier, change takes time, and success does not come automatically, it takes hard work. The Cayman Islands have shown that they have what it takes to succeed. Your dedicated and professional civil service is the envy of many in the region.

The excellent work of the Royal Cayman Islands Police Service has helped ensure one of the lowest crime rates in the Caribbean. Your values of public service and respect for the rule of law – values that we very much share - offer a bright future for the Cayman Islands, and one which the UK is keen to support.

Disaster preparedness

We already provide support in the important area of preparedness for natural disasters. We have a naval vessel in the Caribbean 365 days a year ready to respond to any crisis in the Overseas Territories. Yesterday, I visited a hurricane shelter on Cayman Brac, and heard about the excellent work of the Hazard Management Department, police, fire service and other agencies to ensure that the population is protected.

Environmental protection

Protecting the environment is also fundamental to these islands. Another thing I learned about yesterday was the important work on Little Cayman to protect and restore reefs. Your unique environment is vital to your tourism industry – indeed, the bio-diversity of the Overseas Territories is globally important. Protecting it will remain a key priority.

That’s why the UK Government is making additional funds available to the Overseas Territories, and the Governor’s Office is working closely with the Government to develop projects that will protect the environment, together with others that will strengthen security and good governance, improve child safeguarding and support hazard management.

Conclusion

These new projects show that, while the partnership between the United Kingdom and the Cayman Islands may be rooted in the past, it is one that will continue into the future.

I look forward to welcoming your leaders to London next month and to working closely with you in the months and years ahead.

Working together for the best interests of the Cayman Islands and all their people. I felt that strongly before I came here. The opportunity to meet you and the people of the islands makes me sure this is how we will continue. Thank you.

Oct 07, 2013

2013 Throne Speech

Oct 07, 2013

2013 Throne Speech

INTRODUCTION

Madam Speaker, Members of the Legislative Assembly, it was less than a month ago that I swore to serve Her Majesty the Queen and the people of the Cayman Islands in the role of Governor.

Since that time, the people of this country have greeted me warmly. They have also put a human face on the statistics that speak to the state of our economy and society. We all know that we face serious issues relating to the economy, unemployment and crime. The Economics and Statistics Office has also reported the largest increase in the cost of living since the start of the global economic recession in 2008.

Good governance, which I am charged to promote, involves careful and planned management of resources, so that we all benefit from their allocation in a sustainable way.

In the context of the Cayman Islands, this means that we must spend our limited resources wisely, to maintain a world-class reputation as a centre for financial services and tourism. At the same time, we must provide our people with the resources that they need to thrive in this environment.

The Public Service has responded by reducing expenditure and moving towards more strategic ways of working. The budget that is being presented to you today proposes to fund intelligence-gathering, planning, consultation, standard-setting, international collaboration, monitoring and evaluation, as well as stricter enforcement.

You will find that a recurring theme is the use of technology to achieve these goals in a cost efficient way, an initiative that will be led by the very able Deputy Governor.

Accordingly, it is my privilege to share with you the Government’s plans to deliver public services in the context of the Framework for Fiscal Responsibility.

I will begin with the independent offices of Government, before moving on to the responsibilities of firstly the appointed and then the elected members of Cabinet. The Office of the Auditor General, which is celebrating its 30th anniversary, will seek to enhance its independence by working towards a new Auditor General’s Law.

As part of its mandate to be more accessible to the people of the Cayman Islands through outreach and education, the Office of the Complaints Commissioner will republish the Small Claims Handbook. It will also publish a report on whistleblowing before the end of 2013.

The Information Commissioner’s Office will make further recommendations to the Legislative Assembly on the review of the Freedom of Information Law. Faced with an expanding workload and corresponding demands on its existing space, the Judiciary will explore ways to fund a new court house as a matter of urgency.

It will also implement an information technology strategic plan that includes a revamped judicial website that gives access to unreported judgments and laws currently in force as well as e-filing. The Office of the Director of Public Prosecutions will work with criminal justice departments and law enforcement agencies to progress the development of a formal witness protection programme.

Meanwhile the program of legislative work facilitated by the Portfolio of Legal Affairs will include the following key pieces of legislation:

 The Data Protection Bill The Immigration (Amendment) Bill ; and The Standards in Public Life Bill

We anticipate being assessed for effective implementation of the 40 Financial Action Task Force Recommendations as part of the fourth round of mutual evaluations.

Accordingly, the establishment an Anti-Money Laundering Unit under the aegis of the Attorney General’s Chambers is proposed.

Before the assessment begins, the Portfolio will spearhead the development of a National Risk Assessment, to be used as abenchmark for measuring compliance with the 40 Recommendations. It will also assist in discharging the Government’s overall commitment to the G-5 project for Anti-Money Laundering and Anti-Corruption matters.

I turn next to the Deputy Governor’s Office, which will bring legislation to improve the governance of statutory authorities and government companies. It will also conduct a review of public entities, which will aim to rationalise these, or identify those that are obsolete, in need of transfer, or which require separation or amalgamation.

Consideration will also be given to opportunities for privatisation or outsourcing where this is feasible. Focus will also be placed on succession planning for key civil service roles.

A voluntary separation package for civil servants who volunteer to leave the service before the end of 2013 has been announced. Applications from civil servants wishing to take up the offer of separation must be accompanied by a business case that shows how the civil service entity expects to achieve improved efficiency from the staff member’s departure.

Changes to the Police Law will establish a commission to offer civilian oversight of the Police. The Cabinet Office is working to secure Cabinet approval of the revised Cabinet Guidelines and Code of Conduct. This first revision in 20 years aligns processes and procedures with the 2009 Constitution. It is also working with key stake-holders to complete a national policy for persons with disabilities by the end of the year.

Within the Cabinet Office Portfolio, Government Information Services also plans to provide enhanced electronic services tosubscribers of the Cayman Islands Gazette. Next we turn to the Ministries, for which the elected members of Cabinet are responsible.

In the Ministry of Home Affairs, the Royal Cayman Islands Police Service will continue to target serious crime through a variety of strategies, including a pro-active task force that patrols vulnerable locations. Her Majesty’s Cayman Islands Prison Service will work to mitigate issues identified by the United Kingdom and local Prison Inspectors. The prison will also address long-term estate needs while making emergency repairs on existing facilities. It will construct facilities that separate male juveniles from the adult population, and work towards the same for female juveniles.

Separate facilities are being constructed for juveniles detained by the RCIPS.

In the area of information technology, as Government moves towards optimising online services, the Computer Services Department will work with stakeholders to identify and address gaps.

Plans to restructure services and programmes offered by the Department of Children & Family Services will occupy the Ministry of Community Affairs in 2013/2014. To bring these services in line with the Children Law (2012 Revision), it will separate clinical from welfare services. The DCFS will continue to provide clinical social work services, which will focus on the management of the Children Law and other clinical matters surrounding children and families.

A key legislative initiative for the Ministry during the fiscal year will be to amend the Poor Person’s Relief Law and enact the accompanying Regulations. During the 2013/14 fiscal year, the Ministry of Finance & Economic Development will review the Public Management & Finance Law and the Financial Regulations.

It will also begin the establishment of a Central Procurement Office which will standardize Government’s procurement processes. The Customs Department will reform and modernize its compliance management, intelligence and risk management, in order to enhance border security and revenue collection.

Meanwhile the Cayman Islands National Insurance Company, will focus on the implementation of its new eligibility and medical management software systems.

The Ministry of Financial Services, Commerce and the Environment has planned a number of key initiatives in the coming year.

The Department of Commerce and Investment will set up committees to review and propose changes to legislation governing liquor licensing, trade and business licensing, the Special Economic Zone, and the licensing of local companies.

It will also analyse the impact of potential fee structure changes for various licences, and develop an enforcement and monitoring arm. Meanwhile the Department of Environment plans to table the National Conservation Bill, and open it to public consultation. It will also meet with residents of West Bay, Cayman Brac and Little Cayman, to discuss the draft Marine Parks Regulations.

The Financial Services Secretariat will increase engagement with the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes. It will also develop the partnership with the local financial services industry.

Meanwhile the General Registry will upgrade the Companies Online Registry Information System (CORIS). It will also upgrade the disaster recovery programme for corporate records. The Cayman Islands Monetary Authority will also introduce a corporate governance regime within the fiscal year.

The Ministry of District Administration, Tourism and Transport has extensive plans for Cayman Brac and Little Cayman in the coming financial year, many of which relate to fostering the tourism industry.

The Ministry will establish a Cayman Airways Reservations Centre and Cargo Facility in Cayman Brac. It will also expand the Charles Kirkconnell International Airport to accommodate security and screening equipment for the processing of international flights. In addition, it will establish a runway in Little Cayman that is adequate to allow an efficient and cost effective turbo prop aircraft service to that island.

In the area of sports, upgrades to the Cayman Brac FIFA certified field will include additions such as changing rooms and bleachers which will create opportunities for sports tourism in Cayman Brac. Government also plans to convert the hurricane shelter site there to a secondary school.

On Grand Cayman, phase one of the redevelopment of the Owen Roberts International Airport will include expansion of thedeparture lounge.

The Ministry will continue to progress the procurement process of the proposed cruise berthing facility in Grand Cayman. It will also enhance the Royal Watler Cruise Terminal to accommodate increased cruise visitors in 2014 and 2015.

A review of the Port Authority Law and Regulations is also anticipated.

National food security will be a key focus of the Ministry of Planning, Lands, Agriculture Housing and Infrastructure. Its multifaceted approach will include– the expansion of Protected Agriculture Systems for crop production, as well as the promotion of backyard and community gardens and the improvement of the livestock sector. It will also seek to build on linkages between the Market at the Grounds, local restaurants, and the tourism sector.

In addition, it will actively cooperate with regional counterparts on pest safeguarding initiatives, regulatory enforcement, as well as proactive (pest and disease) surveillance and monitoring programmes. The Petroleum Inspectorate will continue its push to strengthen the Dangerous Substances Law through Regulations to ensure a safe, healthy and sustainable petroleum sector, while working with the petroleum industry to establish fuel quality parameters for motor fuel, particularly gasoline.

The Department of Vehicle and Driver Licensing will review and update the Road Code, 2012 Edition.

A new Bodden Town Licensing Office should help to alleviate traffic congestion at the Crewe Road location.

In addition, the agency will collaborate with Computer Services to improve online services for the renewal of drivers’ and vehicle licences.

The Department of Vehicle and Equipment Services will tender for and award the contract, for the provision of fuel to the Cayman Islands Government. Meanwhile, the Department of Planning will aim to increase the efficiency of the planning process at both the department and industry-wide levels.

Recent changes which allow postal staff to represent the customer in the assessment of duties on parcels by HM Customs, will facilitate the move by the Postal Department towards parcel delivery during the financial year.

Implementation of a new box rental database will allow customers to conduct all box rental matters at any post office within the Cayman Islands.

The Water Authority will commence work on the upgrade and extension of the piped water distribution system in Cayman Brac. Regulations will also be revised to implement the Rate Cap Adjustment Mechanism method of calculating annual rate adjustments.

In response to the need for a further 36 megawatts of electricity on Grand Cayman, the Electricity Regulatory Authority will conduct a competitive solicitation for the development and operation of a new power generation plant. Another important goal in the coming fiscal year will be to support the National Energy Policy Committee’s mission to establish a National Energy Policy for the Cayman Islands.

I turn now to issues relating to education and employment.

In 2013-14, the Ministry of Education, Employment and Gender Affairs will move towards a phased implementation of the National Strategic Plan for Education and will introduce a new legislative framework for education. In particular, there will be a continued focus on strategies to improve teaching in maths and literacy.

The year will also see the formal launch of the new “Safer Schools” strategy, an umbrella programme of initiatives that promote respectful learning environments which value individual safety. Areas of focus will include anti-bullying and parenting programmes, as well as initiatives to support pregnant teens.

A code of practice for gifted and talented students will be developed and work to expand vocational programmes in high school and beyond will take place. In the sphere of tertiary education, the University College of the Cayman Islands will add new programmes and courses. These will include an associate of arts degree in legal studies incollaboration with Chartered Institute of Legal Executives; and an executive certificate in global leadership in collaboration with the University of Texas at Arlington.

The National Workforce Development Agency will benefit from a legislative framework to underpin its work. It will also introduce improved employment services, including the provision of assessment tools to identify skills and knowledge deficits.

In addition the agency will implement a national work readiness programme, in which barriers to employment and career progression are effectively identified and remediated.

Finally the agency will develop a national strategy to facilitate a culture of life-long learning in the Cayman Islands. At the Sunrise Adult Training Centre, staff will work to develop an internship programme for persons with disabilities and will partner with the NWDA to increase employment placements for adults with disabilities.

With regards to employment and benefits, the Department of Labour and Pensions will benefit from major legislative changes through a revised National Pensions Law and amendments to the Labour Law.

In addition, the activation of the new Inspections Unit, will allow for proactive inspections and audits of workplaces in accordance with the law.

The Gender Affairs Unit will continue to work towards having the Convention on the Elimination of All Forms of Discrimination Against Women extended to the Cayman Islands. It will provide a 10 year review and update of the National Policy on Gender Equity and Equality.

I move next to the key area of health.

The Ministry of Health, Sports, Youth and Culture will identify a major overseas healthcare provider to explore partnerships that will enhance our capacity to provide a world-class level of healthcare.

New Cancer Registry Legislation will enable policy makers, researchers, clinicians and public health professionals to monitor the burden of cancer, evaluate treatment programme success, and identify additional requirements for cancer prevention and control efforts at a national level.

In addition, the ministry will seek to improve diagnostic services through the installation of magnetic resonance imaging (MRI) technology. It will also explore the feasibility of promoting and safely regulating health research and clinical trials in the Cayman Islands.

The implementation of the updated Mental Health Law will include the appointment of a Mental Health Commission. The Ministry is also committed to the delivery of proper mental health facilities.

In addition, the Ministry will seek to engage the public in the preservation and promotion of the Cayman Islands’ cultural heritage through educational programmes.

There will also be a continued focus on developing Sports Tourism.

The Mosquito Research and Control Unit will explore field trials for a proposed Oxitec project as a comprehensive and effective strategy for Dengue prevention.

Finally, the Ministry will also be publishing a Request for Proposal for a comprehensive and integrated waste management solution for the Cayman Islands.

Conclusion

Madam Speaker, Members of the Legislative Assembly, it is incumbent on this honourable house to ensure that the proposals submitted by Government for the coming financial year offer the people of the Cayman Islands value for money. This is a weighty task, the importance of which cannot be overestimated.

I would like to acknowledge those who have played a role in the preparation of the budget, an arduous job that can take many months.

The civil service is also to be commended for the reduction that it has achieved in personnel and operating costs. Their savings to the country have come at a cost to many. However, ensuring the sustainability of these Islands is a noble and worthy cause.

The work of Government has an impact that is far-reaching. We must all do our duty to help Caymanians and residents to meet the challenges of everyday life.

Thank you for listening and may your deliberations be guided by the hand of Almighty God.

Oct 07, 2013

2013/2014 Policy Statement

Oct 07, 2013

2013/2014 Policy Statement

GETTING BACK ON COURSE

2013/14 Policy Statement

Delivered Monday 7th October, 2013

Hon. Alden McLaughlin, MBE, JP, MLA

Premier

As we meet in this Honourable House today to present the first full Budget of this Government, I am minded to recall for Honourable Members the words we read in Proverbs that ‘A good name is to be more desired than great riches, favour is better than silver and gold’.

On the 22nd of May of this year the People’s Progressive Movement was given a mandate to restore the good name of the Cayman Islands; to restore the lustre to our tarnished reputation. A reputation that had been sullied both at home and abroad by charges of corruption, abuse of office, mismanagement of the economy, a soured relationship with the United Kingdom and all manner of unsavoury practices and unseemly behavior.

Socrates entreats us to, “Regard your good name as the richest jewel you can possibly be possessed of - for credit is like fire; when once you have kindled it you may easily preserve it, but if you once extinguish it, you will find it an arduous task to rekindle it again. The way to a good reputation is to endeavor to be what you desire to appear.”

A good reputation is the flip side of the confidence coin. As we promised in our Manifesto, ‘The first and most challenging task of a new administration, therefore, will be to restore trust and confidence in the government and the Cayman Islands as a whole. Nothing is possible without that.’

Restoring that confidence, Madam Speaker, was our very first step in getting our country back on course. We believe we have made considerable headway in this regard. Suspicion and skepticism by the Foreign & Commonwealth Office have been replaced with trust and respect; foreign investors have certainty that transparent, legal processes will protect their investments, while local business owners have been buoyed by the consultative process that we bring to managing the affairs of this country.

We know that the restoration of confidence is not a one shot deal and we shall continue to consult regularly with stakeholders in business and civil society and maintain our promise to be open, transparent and accountable. We will continue to work hard with the public servants and our private sector partners to bring back pride to Caymanians and residents and all who love this country.

With the return of confidence has come an air of hope that was absent prior to May. We wish to take that hope and through sound financial management and responsive social policies, transform it into a better quality of life for all who live here and contribute to the growth and development of these Islands.

We shall do so Madam Speaker, in a disciplined, deliberate and transparent way.

There will be no silver bullets or one size fits all cures. We still face the challenges as a country that we did prior to May 22nd, but we believe that with a new approach to

managing our affairs we can indeed move forward to a better tomorrow.

And you may well ask what is this new approach. It will be characterized by prudent financial management, as the Minister of Finance will explain later in his presentation to this honourable Chamber. It will see a targeted approach to improving the lives of Caymanians through specific educational and training programmes. Investment in a modern infrastructure will be within our means and will yield maximum returns for the country. Expenditure on government and by government will give value for money. While government will do its part as facilitator, principally growth and employment will be private sector driven.

At the core of future economic expansion will be a reformed immigration regime that will protect the right of Caymanians to have gainful employment, while acknowledging the necessity for businesses to have a reliable labour force.

Madam Speaker, the road that brought us to the delivery of today’s Budget was not the yellow brick road, but the journey was made easier when in August the Foreign and Commonwealth Office approved the Cayman Islands Government’s four-year fiscal plan covering the years 2013/14 to 2016/17. It was one of the first steps to restoring the UK’s confidence in us. It also demonstrated how positive results can be achieved when processes are followed and a logical, credible and consultative approach is taken toward fiscal planning.

For our first two months in office, we kept our heads low and worked steadfastly to develop this plan, which followed weeks of meetings between the Ministry of Finance and key stakeholders across the public sector. The resulting plan is credible, sustainable and charts the necessary trajectory for the country to meet the fiscal targets outlined in the Public Management and Finance Law. Because of the hard and diligent work of my team, ably led by the Minister of Finance, the UKwas able to approve the Plan on its first submission; an historic occasion.

The Plan favours an initial aggressive reduction in public sector operating expenditure, significant increases to Government’s cash reserves, no new long-term borrowings, continued repayment of existing loans and zero inflationary revenue measures. The Plan assigns to the Government the role of facilitator of economic growth by virtue of its support for various private sector initiatives, does not propose any major capital expansion programmes and is not dependent on anyrevenue measures for success.

We are proud of the budget we are presenting today, Madam Speaker. It is balanced and has a healthy operating surplus realized through cost saving measures. The Government is all too aware of the cost of living in the country, both for individuals and businesses. We have no plans to introduce any measures that would further burden the cost of living; as a matter of fact we are looking for ways to give our people, residents, visitors and businesses some relief when it comes to their pocketbooks.

This budget provides the financial basis to address the problems of the Cayman Islands and gives life to the government’s plans, vision and programmes that Her Excellency the Governor outlined in the Throne Speech and which will be expanded upon in this speech and that of the ministers to come in the upcoming debate.

Madam Speaker, while fiscal responsibility and discipline are important principles for government, ensuring the populace has a better quality of life is one of our main objectives.

At the forefront of this is getting jobs for all qualified and capable Caymanians who want to work. The Government is revamping the work of the National Workforce Development Agency (NWDA) to make it easier for Caymanians looking for work to register. Under the plan, which is nearing completion, businesses in the Cayman Islands will work with NWDA to find and employ Caymanians. We have heard the cries of our people in their search for jobs and we are doing much to ensure jobs for Caymanians in the near and far future.

But, Madam Speaker, I have to be honest with you. The lack of jobs for Caymanians was not created by this Government. Like many other issues facing this country, we inherited this problem. This Government was elected to face and fix the problems, and we are doing just that. A sustainable solution to the issue cannot be implemented overnight, but the combination of increased economic activity, new provisions to protect the rights of Caymanians in the Immigration Law, new programmes by NWDA in the short term and expanded vocational training in the near term will put Caymanians back to work and the country back on track.

I have heard much rhetoric in recent weeks about whether this Government is more concerned about expatriates than Caymanians; about whether we are against foreigners. I can only characterize much of the debate as ill-informed political sniping, Madam Speaker.

As Caymanians, we know that there is a history in this country of Caymanians being unwilling to do certain jobs. We have to ensure that the labour needs of the market are adequate to service the areas where Caymanians are not qualified or not available for a myriad of reasons.

Under the new Immigration reform proposals, it will now be an offence, carrying a fine of up to $20,000 in the first instance, for an employer to fail to disclose that a Caymanian, a spouse of a Caymanian or a permanent resident has applied for the position, when applying for a work permit or renewal. But everyone must remember, despite people playing on the emotions of Caymanians, the Immigration Reform proposal is not employment legislation.

The Ministry of Education, Employment and Gender Affairs is working on a suite of programmes to get Caymanians into the workforce. We have identified 200 unemployed Caymanians who have expressed interest in working in the Hospitality Industry. Those people will be matched to available jobs in the industry for hires beginning this month and next month.

We are also working with the private sector, including Health City and Cayman Enterprise City, both of which have made commitments to hire Caymanians.

Employment opportunities for Caymanian artisans and construction workers will improve with the start of construction on DART’s new hotel property on the West Bay Road and a new hotel in East End being proposed to service Health City. A proposed new golf course development in Frank Sound will also provide opportunities for employment.

I am sure you will be pleased to learn Madam Speaker, that in order to promote job growth in Cayman Brac, Cayman Airways will establish a Reservations Centre in Cayman Brac. This Centre on the Brac will not only assist in creating jobs, but will also further the disaster mitigation efforts of Cayman Airways.

There are many other initiatives that will help Caymanians get jobs, not the least of which is education and vocational training. Under the previous PPM Administration, great strides were made to improve the level of education our children receive. I am proud to say our work continues to this day and we will see full-scale implementation of the National Strategic Plan for Education with a continued focus on improving teaching in maths and literacy.

The Minister of Education will provide in greater detail the elements of the NWDA plan as well as the core aspects of the Strategic Plan for Education during her presentation, so I will not go into any further detail at this point.

Madam Speaker, before I move on to addresss further specifics of our policies to get the country back on course, I feel I must first speak to a matter that is of great concern to the Cabinet, the Government and indeed most Caymanians and residents of these Islands and that is the recent increase in gun-related crime.

I wish to assure the country that while we work on improving our economy, we are also going to pay close attention to the safety and security of all persons who live in and visit our Islands. This recent rash of firearm related robberies and burglaries cause me and the Government grave concern. I am happy to be able to report to the House today that the RCIPS has been successful in apprehending and taking into custody a number of those suspected of committing the recent spate of burglaries and robberies. However we recognize that much more must be done to prevent these kind of crimes.

The Commissioner has briefed both Cabinet and the National Security Council on his strategy of responding to reported crime. Law Enforcement Officers have a number of assets at their disposal, which are deployed when needed. Assets like the Police helicopter, the National CCTV System, which boasts over 230 cameras spread across Grand Cayman. There are also electronic monitoring tags that can be used to virtually monitor the exact whereabouts when suspected persons are released on bail by the police or the courts.

You would have read about the recent interception of a Jamaican Canoe and the arrest of a number of Jamaican nationals and Caymanians who are suspected of importing hundreds of pounds of ganja into our islands. This interception carried out by the officers in the Sister Islands, assisted by the Joint Marine Unit, is the kind of result we want to see continue until the message becomes clear to all...the Cayman Islands is open for business, but closed for criminal activity andcorruption.

Whilst the Police and other Law Enforcement agencies play an important part in responding to and investigating criminal activities, our Country's safety and security is a national issue that requires all hands on deck to stop the unacceptable levels of criminality.

Government will be looking at further ways for private individuals and businesses alike to better protect themselves. We see that a number of the crimes committed recently have occurred where the victims are vulnerable or the premises unsecured.

We will be making provisions, whether by legislative change or by duty concessions, to better assist persons and businesses from falling victim to criminal activity.

A bit later during my presentation I will speak to the aims and progress of the National Crime Prevention Strategy.

I turn now to our plans for the Financial Services industry.

Madam Speaker, at 49 per cent of GDP, and accounting for 55 per cent of Government revenue, the Financial Services industry is the most important driver of our economy today. Challenges to our on-going success as an international financial centre are many – from increased competition and new international regulatory initiatives, to continuing, uninformed attacks on our reputation and quality of business.

But there have been several victories since we took office, and we are poised to make great strides this fiscal year. You would have heard Prime Minister Cameron’s defence of the UK’s Overseas Territories quite recently. By saying that the OTs should not be maligned as tax havens, he has recognised Cayman’s leadership in addressing tax evasion, and our commitment to participating in the global automatic exchange of tax information. Other OTs are now moving quickly to more closely emulate our position, and to demonstrate similar levels of commitment.

To the naysayers who suggest our actions will cripple our industry, this small victory must be seen in the context of a complex and global political agenda that continues to rapidly head in one direction. Cayman cannot stand alone against this global tide. Our future success depends largely on an approach of international engagement; providing expertise to the multilateral dialogue; and importantly, reaffirming our sovereign right to maintain a responsible public revenue system that benefits our people, and also supports the efficient and ethical functioning of the global financial community.

As noted by recent Government administrations, including this one, our participation in these global initiatives will have a cost to Government and local industry; specifically, we will have compliance and administration costs related to our Model 1 intergovernmental agreements for US and UK FATCA. But this is necessary and indeed inevitable as the alternative would have surely brought us ruin.

These international challenges notwithstanding, we also need to focus locally, and to recognise the strength that has resulted in our vaunted position in the first place. The breadth and depth of financial services expertise in Cayman has been a key driver of our success – driving innovation and new markets expansion, and enhancing the quality of our services.

The government which I have the honour to lead is therefore very supportive of a renewed partnership with industry, and closer ties with organisations such as Cayman Finance will help us to regain an innovative edge among international financial centres. During this fiscal year, we will consider several amendments to existing financial services legislation, and new legislation as well, that are much anticipated by industry.

Among these is the introduction of a new corporate governance regime that will reaffirm the quality of our home-grown directorships industry, further raising the bar for others to follow us as the leading domicile for funds worldwide.

As we continue to work to ensure that Caymanians are educated and employed, we are also mindful of the social needs in our Country. During the 2013-14 financial year, the Ministry of Community Affairs will focus on implementing some of the efficiency recommendations from the Civil Service Review of the Department of

Children & Family Services, the major one being the separation of the welfare aspects into a Need Assessment Unit.

Provision and management of financial assistance services will be covered by the Needs Assessment Unit in a more efficient and comprehensive manner inclusive of poor relief, school lunches, food vouchers and burial assistance.

In order for the Needs Assessment Unit to operate in an effective manner, amendments to the Poor Person’s Relief Law as well as the development of accompanying Regulations will be required.

With the implementation of the Children Law (2012 Revision) and its enabling Regulations, it is important for the Department of Children and Family Services to ensure that it is in compliance with the various requirements of the legislation. As a result, there will be a separation of clinical services from welfare services. A crucial aspect of the clinical services is the Child Protection Unit.

In compliance with the Children Law, homes in which children are placed will now be inspected to ensure that they provide nurturing and safe residential care for children in need of care and protection.

The Adoption Law was amended in March 2013. The Adoption Regulations are expected to be passed in early 2013-14. In the Judiciary, rules of court are now in place and steps are being taken to create the panel of guardians ad litem required under the Law, which the Judicial Administration will direct.

The Department of Counselling Services will continue to provide community-based counselling and residential programmes to people who require assistance with drug and alcohol issues, family and relationship difficulties and/or issues related to personal development (these include issues such as trauma, grief, depression, anxiety and substance abuse.)

Another important aspect of the Department of Counselling Services is the delivery of family programmes that will assist parents to develop positive and effective parenting skills and that are relevant to communities within the Cayman Islands. The Ministry of Community Affairs will continue to work across ministries and alongside key stakeholders to ensure that the needs of children, families and communities are met holistically.

October is the Month of Older Persons and I invite all members of this honourable House to participate in the many activities planned. However, as a country we need to ensure that the elders continue to be included and protected. This year we will review the services provided to the elderly by DCFS.

The Government wants to recognise those who have gone before us by celebrating our heroes in cultural heritage, the theme for National Heroes Day 2014.

The nomination form for National Heroes day has the following definition: “Cultural Heritage is fundamental to a people’s memories, identity, and creativity, and adds to the richness of cultures. It is the legacy of tangible physical artefacts and the intangible attributes of a people that are inherited from past generations, maintained in the national identity, and bestowed for the benefit of future generations.”

Madam Speaker, it is sometimes said that our society is judged by how we treat our vulnerable, including our intellectually or physically challenged. As a society we have a duty to do our best for our most vulnerable. Section 16 of our Constitution – the Bill of Rights – establishes that “…government shall not treat any person in a discriminatory manner in respect of… rights under…the Constitution.”

This section includes persons with mental or physical disability.

The Cabinet Office in partnership with persons with disabilities and other key stakeholders will be completing a national policy for persons with disabilities. The vision of the policy is “ensuring persons with disabilities live with dignity, are respected and participate fully in society.”

I must state, this is a matter that is near and dear to my heart. This process commenced under the previous PPM Administration and originated within my then Ministry. Continuing to build on the foundation set during our previous administration, I am pleased to see that the last government recognised the important work that had been done and continued the process.

These efforts over successive governments are leading up to the creation of a comprehensive national policy and bespoke legislation aimed at bettering the lives of persons with disabilities. To this end the draft goals of the policy are to:

• Ensure persons with disabilities have a quality education in the most appropriateinclusive setting, and access to lifelong learning;

History shows that too many policies have been shelved or partly implemented over the years. To increase the likelihood of implementation effectiveness of the National Disability Policy, action plans will support policy objectives, strategies, goals and the vision. The ultimate aim is to ensure persons with disabilities can live with dignity, are respected and are able to participate fully in society.

As Premier, I have taken a personal interest in seeing this process through and I am pleased to say that I have the full support of my colleagues especially in the key Ministries of Education, Employment & Gender Affairs and Health, Youth, Sports and Culture. A better, more just Cayman is a Cayman that finally enshrines protection for the most vulnerable in our community. Nothing can be more edifying and Christian.

Madam Speaker, we also need to pay some attention to those among us who we have lost, and are losing, to debilitating diseases like diabetes, hypertension and cancer. Although there is already an established Cancer Registry, the reporting of the incidence of cancer has been very poor. This means that the data collected does not accurately reflect the incidence of cancer, or provide accurate information regarding the most prevalent types of cancer.

In order to better target prevention programmes, educational efforts, and oncology services, we need to have better information regarding the incidence and prevalence of cancer in the Cayman Islands.

At last year’s National Healthcare Conference, there was a breakout session that focused on cancer, and one of the recommendations from that group was to enhance the collection of data regarding cancer in the Cayman Islands. The proposed legislation from the Ministry of Health will make it mandatory for healthcare providers to report incidences of cancer to the registry and make provisions regarding the confidentiality of the registry. It is currently in initial drafting stages, and should be completed during the course of the current financial year.

As we continue to identify the non-communicable diseases that are doing us the most harm, we are in the process of identifying a major overseas healthcare provider to explore partnerships to further enhance our capacity to provide our residents with world-class healthcare.

The Health Services Authority will be issuing a Request for Proposal seeking an overseas healthcare provider to establish a formalised partnership to facilitate training of HSA staff in all areas (healthcare providers and administration), assist the HSA to further establishing their robust framework of policies and procedures based on global best practice standards, investigate the feasibility of pursuing international accreditation of the George Town Hospital, and if determined feasible, establish a critical path to achieve it, and, assist the HSA in reaching a standard of excellence in customer service, patient-centered care, and financial management.

We are also working on the Mental Health Law and Mental Health Commission Law, which represent significant advancements in the legislative framework for mental health. One of the key components of the new legislation is the creation of the Mental Health Commission, a new oversight body for mental health in the Cayman Islands. Once appointed, the Mental Health Commission will act as an appellate body for patients who are involuntarily detained under the Mental Health Law, advocate for and promote increased education and awareness of mental health issues in the Cayman Islands, provide policy advice to the Minister of Health and the various health councils, as well as providing a central point of data collection for mental health statistics.

The Ministry of Health will work with the Mental Health Commission to investigate the feasibility of undertaking the WHO AIMS (Assessment Instrument for Mental Health) study, which was developed by the World Health Organisation to assess key components of a mental health system, and thereby provide essential information to strengthen mental health systems.

Through the WHO-AIMS it is possible to identify major weaknesses in mental health systems in order to have essential information for relevant public mental health action.

While we are committed to taking care of our people, the Government is also taking steps to get the House of Government in a state of wellness.

Madam Speaker, as we seek to strengthen the institutions of Government to protect against abuse of office and corrupt practices by those in government, Cabinet, supported by the Cabinet Office, has begun to review Cabinet’s Guidelines and develop a revised Code of Conduct for Cabinet. This has not been done since September 1995 and Cabinet still functions under this guide to the Operations of Executive Council, which is woefully out of step with the 2009 Constitution. In 2005, the previous PPM Administration commenced the process of updating the new Cabinet Guidelines and now that we have a modern Constitution, this is all the more essential. We have therefore again made this a priority.

Furthermore, once the process of updating this critical document has been completed, it is the Government’s intention to publish these revised Cabinet Guidelines as a public document for the very first time! In anticipation of the revised Cabinet Guidelines, the Cabinet Office will be posting to the Government’s website also for the very first time the existing 1995 Guide to the Operations of Executive Council, which until now, has been a restricted document. This will hopefully give the people of the Cayman Islands a greater understanding of the structure and functions of the Cabinet.

The review, which began when we took up office, is expected to align processes and procedures with the 2009 Constitution and will be informed by international best practice. While there is a code of conduct in the existing Guide to the Operations of Executive Council, we have found this to be too limited in its scope. The landscape of policy-making has changed dramatically and the public demands for good governance, accountability and transparency warrants a revised and up to date Code of Conduct.

Therefore this new Code of Conduct will seek to address some of the followingareas:

We will also seek to enshrine the seven principles of public life, known as the Nolan Principles, in this code which include Selflessness, Integrity, Objectivity, Accountability, Openness, Honesty and Leadership.

It is for us as the elected government to take ownership of the new Cabinet Guidelines and the revised Code of Conduct. By signing on to this we are making a public declaration of the standards to which we will hold ourselves as Cabinet, setting the bar for any future Government. As Premier, I will hold myself as well as my Cabinet Members accountable to this standard. It should also be noted that the guidelines and the Code of Conduct will also apply to the ex-officio (nonvoting) members of Cabinet, but it is for the Governor to hold them accountable in that regard. It is expected that the review will be finalised before year-end, thereby fulfilling another of our promises set out in our manifesto.

The Government is also focusing on public sector reform. The original design of the public sector reform model promulgated more than a decade ago contained three components that were to be supported by three pieces of legislation: the Public Management and Finance Law and the Public Service Management Law were passed to cover the financial and personnel aspects of the model but the governance component of the trilogy was never introduced.

The Public Authorities Bill was prepared and consultations took place during 2006 but there was little support for it from the public authorities so it was shelved. The Auditor General in recent reports has highlighted a number of governance issues pertaining to public authorities and a number of these issues have been played out in the media, in terms of appointment to boards and conflicts of interests.

The Government has commissioned a review of all statutory authorities and government companies. The primary objectives of the review team are two-fold: to improve the governance of statutory authorities and government companies and to improve the financial performance of statutory authorities and government companies.

Following on from the report that developed the present ministry/portfolio structure, the Government will be reviewing in depth all public entities with a view to identifying to Cabinet those that are no longer fit for purpose and need to be abolished, those that are misplaced and need to be transferred or require separation where there are governance, regulatory of human rights conflict issues or combining those where synergy would better serve the needs of the country.

The review will also focus on those functions that would be better carried out by the private sector, either through privatization or the contracting out of services. Meanwhile, in its continuous effort to modernise legislation on our books, the Law Reform Commission will be introducing a number of Bills relating to important social issues. These include:

The Family Property (Rights of Spouses Bill), 2013 which seeks to give recognition to de facto relationships of a duration of five or more years. Such persons would have the same rights in a family home and to division of property as married persons and can apply to the court for financial remedies in the same way.

The Bill also provides that each spouse to a union or marriage shall be entitled to one-half share of a family home on the grant of a decree of dissolution of a marriage or the termination of cohabitation; on the grant of a decree of nullity of marriage; and on the grant of a decree of judicial separation. The entitlement is not an absolute one and the court will have the power to vary such entitlement.

The Sexual Harassment Bill, 2013 was submitted to the AG earlier this year and seeks to eliminate sexual harassment in workplace and other institutions. Both sexes would be protected under this legislation.

The Legal Aid Bill, 2012 is at drafting stage. That Bill seeks to reform the system of legal aid in the Islands in order to ensure the more efficient management of such aid. The Bill also provides for the establishment of a legal aid office with a legally qualified attorney as Director and other supporting staff.

The Commission is working on a paper and Bill relating to conditional fee agreements to provide for a different way of funding legal actions in order to give persons greater access to justice. A conditional fee agreement is defined as an agreement with a person providing advocacy or litigation services which provides for legal fees and expense, or any part of them, to be payable only in specified circumstances.

The Maintenance Bill, 2013 seeks to reform the law of maintenance by giving men an equal right to maintenance and by expressly setting out the matters which must be taken into account by the court when considering maintenance applications by both sexes.

In accordance with section 5 of the current Matrimonial Causes Law a woman has only to prove ordinary residence for two years in order to be able to file for a divorce under the Law while a male has to prove the more difficult fact of domicile.

The Matrimonial Causes Amendment Bill, 2013 seeks, among other things, to eliminate this inequality and to apply the same criteria to both sexes based on nationality or residence.

These are all important social issues that as a mature society we intend to make right.

Madam Speaker, a series of factors have coalesced to cause renewed interest in the production of food locally. The health conscious among us want fresh, naturally grown and reared food. More and more people are recognizing the cost savings to be derived from backyard and community farming and there is greater interest and acceptance in using local produce in fine dining restaurants catering to the hospitality industry. All of this plays into the Government’s policy of greater food security.

The Department of Agriculture’s efforts are designed to increase production efficiencies, expand production, increase food security and enhance safety of domestic food supply.

Working closely with farmers through commodity groups, the aim is to identify and target crops and livestock initiatives that offer the greatest potential for import replacement and the constraints that must be addressed to achieve these objectives.

At a broader community level, the focus will be on the promotion and support of backyard farming as a means to both increase domestic food production and encourage healthier dietary habits among the population.

The department’s marketing support for the sector will continue to be focused on support of ‘The Market at the Grounds’ which has proved a successful model to date. There is a need to expand linkages with the tourism sector; providing farmers greater access to local hotels and restaurants while supporting the growth of culinary tourism. The Market at the Grounds has already proven itself as successful model for providing greater exposure for local produce and fostering linkages between the producers and chefs. A number of leading chefs now visit and purchase weekly from the market, with the menus in their restaurants featuring and promoting local fare. The Department and the market vendors are actively looking at ways to build on this success and to continue to broaden the exposure for local products both to the restaurants and directly to visitors themselves.

One key area already identified and recommended for immediate attention, is the development and expansion of agri-processing. It is critical that the sector move away from a traditional focus on primary production and encourage and promote secondary processing that will both enhance value added returns and enable agri entrepreneurs to tap into previously unavailable markets and in so doing, enhance linkages with the tourism sector.

Owners and operators of motor vehicles will be pleased to learn that the petroleum inspectorate will be working with fuel importers to establish quality standards for all petroleum products, while the Department of Vehicle and Drivers’ Licensing will be looking to improve its service by electronic vehicle registration and offering more of the Department’s services online.

Meanwhile, the Water Authority has planned the continuation of various pipeline extensions and upgrades in Grand Cayman. Additionally, the Authority will commence work on the upgrade and extension of the piped water distribution system in Cayman Brac.

Madam Speaker, as I said earlier, critical attention is being given to keeping the Crime Reduction Strategy alive by the National Security Council - supported by the Policy Coordination Unit in the Cabinet Office. In order to have meaningful impact on crime, relevant Government agencies, civil society, private sector and the public all play an important role in the Crime Reduction Strategy.

The strategy covers four approaches to reducing crime: Early Intervention; Situational Prevention; Enforcement; and Reducing Re-offending. In recent years we have perhaps focused on enforcement due to the increase in serious crime.

While we must continue to ensure that law enforcement is provided adequate resources to fight crime, in order to have any significant medium to long term impact, we must emphasize early intervention, prevention and reducing re-offending. This takes “all hands on deck”, from parents, teachers, residents, civil society, the private sector, communities as well as government.

Numerous programmes to fight crime exist. Obviously, programmes are not our problem. But to really make a dent in crime we must ensure a coordinated effort toward enhancing synergy, communication, accountability and effectiveness of these various programmes and efforts. Here are some quick examples of how this should be working:

• Government and other entities involved with implementing parts of the Crime Reduction Strategy must provide progress updates to the Cabinet Office when requested and be accessible for monitoring purposes.

• Civil society organisations receiving public funds to implement programmes must prove their effectiveness in order to secure future Government funding. (The mere existence of a programme does not equate to effectiveness).

• Both Government and the private sector could do more to hire ex-offenders in appropriate jobs. I am pleased to say that the Civil Service is finalizing a policy on employing ex-offenders.

Madam Speaker, the Government is optimistic that coordinated efforts will bear fruit. The public deserves no less. While not wishing to single out any particular programme due to the stellar efforts of many, too often we hear of doom and gloom and not enough about outstanding efforts.

I would like to highlight the work of the Youth Anti-Crime Trust (Youth Act), which recently partnered with the Department of Education, Police and Prison Services in delivering Youth Crime Prevention Day to high schools. Students heard first hand from prisoners who visited their schools and others about the importance of taking personal responsibility for choices and the consequences of poor choices. Through role play, students also experienced the loss of freedom thatcomes with convictions for breaking the law.

They were on “lock down” throughout the day, escorted to and from workshops by Prison and Police Officers, with the restrictions that would be applied to prisoners. An important aim of the Trust is a reduction in suspensions in the school system and a decrease in youth criminal offences contributing to a safer society for all. This is just one example of where coordinated action can yield promising results.

Madam Speaker, as much as we appreciate the men and women who make up our forces, we know that we need mechanisms in place which hold them accountable, too. The Attorney General developed the Police Bill 2008, which was enacted in 2010, which established the Police Public Complaints Authority as a statutory authority. Although this law has been enacted, the Authority has not been set up as it has been determined that to do so would be an unacceptably costly exercise.

However, the absence of an oversight body to deal with complaints against police officers leaves Government vulnerable if there is a major police incident that requires independent investigation into the conduct of a police officer.

The Government has therefore agreed to amend the Police Law to provide for a Commission that will act as an independent civilian oversight body for the Police and will receive and order investigation of all complaints made by a member of the public against a police officer and or civil servant acting under the auspices of the police. The necessary amending legislation will be brought to this honorable House shortly. It is envisaged that any complaint regarding death or serious injury as aresult of police action will be investigated by a team of investigators from overseas.

The Commission will be supported by the existing Commissions Secretariat with the additional resource of an independent investigator. If the facts of the case show potential alleged criminal activity, the Commission will pass the file to the Director of Public Prosecutions.

I turn now Madam Speaker to that other important economic pillar – tourism.

Sports Tourism is an area ripe for further expansion. We have already seen such successful events as the NORCECA Beach Volleyball events, the Cayman Invitational Track Meet, the CARIFTA track championships, and more recently, the CONCACAF under-15 boys football tournament that brought some 700 players, their coaches, family, and friends, to our shores during August of this year.

Plans are already under way for the CONCACAF under-20 women’s tournament in January, which will bring international media exposure to the Cayman Islands through the broadcast of the tournament on Fox TV.

On Cayman Brac, the certified FIFA pitch will be improved with amenities such as changing rooms and bleachers. This will allow for internationally recognized soccer matches to be played on Cayman Brac.

We are also blessed with ideal conditions for watersports such as sailing, fishing, and kitesurfing, all of which will see international competitors coming to our shores over the course of the next year.

The promotion of sports tourism presents an opportunity to not only promote the Cayman Islands as a tourism destination, but also enhances the profile of sports in our community which has the potential to lead to more and more of our residents choosing to embrace active lifestyles and life-long participation in sports.

Just as in sports, there is a playing field – globally and locally – for commerce.

Similar to the way we have fought for a level playing field internationally, Government is pursuing several initiatives that intend to ensure a level playing field locally.

A tremendous amount of work has already gone into a substantial amendment to the Trade & Business Licensing Law – to modernise its provisions, allow for greater efficiency in its administration, and ensure a level of enforceability to address the imbalances that are often highlighted by local businesses. We hope to take this Bill to the LA in the first quarter of 2014, recognising that public consultation and education will be a very important part of the process.

And there is more to come. We already have created two working groups – one to review the Local Companies (Control) Law, and the other to review the Liquor Licensing Law. Both of these, but especially the latter, have seen their fair share of controversy.

But Government will not shy away from tackling difficult, yet important issues, and from striving to put in place an even better framework to foster and support local business.

There are several passionate and competent members of this Government with a keen interest in supporting entrepreneurship and ensuring that our small businesses have a fair shot at success. We will create a task force to evaluate current small business programmes, explore new initiatives, and drive the implementation of new services that will increase the viability of this dynamic and important sector of our economy.

A tremendous amount of work is being done to support our business environment, but we will not lose sight of the equally important duty to protect and conserve our natural environment and resources.

The long-awaited National Conservation Bill will be brought to this honourable House before the end of this year. This important legislation has the support of my caucus, and we have ensured that the Department of Environment, or DoE, will be in a position to support this legislation once it is passed. The draft Bill being presented is substantially the 2009 version prepared by the former PPM administration, updated to address concerns raised by the past UDP administration and independent Members.

While Government plans to allow Members of the House and the public significantly more time than the required 21 days to review the draft Bill, we do not anticipate significant amendments, and we look forward to unanimous support for this seminal legislation.

The Government also is committed to continuing the consultation on proposals to enhance our current system of marine parks. DOE research shows that, while the marine parks are providing some protection, a confluence of factors has caused serious changes to our reefs, and the current protections therefore are no longer enough. These factors include population increase (resident and tourist), overfishing, coastal development, invasive species, disease of coral and other marine organisms, and climate change.

The future for our marine resources is bleak without decisive and timely corrective action. An appropriately configured and enhanced system of marine parks is the best tool available for actively managing our marine resources in order to achieve fisheries sustainability, biodiversity conservation, and ecosystem resilience, in the face of the existing and emerging threats.

Further, we recognise the importance of addressing climate change.

We acknowledge the sobering message of the report by the Intergovernmental Panel on Climate Change, a summary of which was released on Friday, 27 September: Climate change is real, it is caused by human actions, and it continues unabated.

Cayman simply cannot afford to ignore the conclusions of this worldwide committee of eminent scientists, as the implications for the continued rise in sea levels will have severe consequences for future generations if left unchecked. The Government therefore intends to adopt the draft climate policy, produced in 2011 by a multidisciplinary public/private sector initiative led by the DoE, and to begin urgent work on an implementation plan.

And lastly, in an effort to honour our commitments made under the Convention on International Trade in Endangered Species of Flora and Fauna, Government will take all necessary steps to bring into force the updated, local CITES-implementing legislation – the Endangered Species Trade and Transport Law – which was passed by this honourable House in 2004.

Madam Speaker, we must do all that we can to protect the environment on all three Islands to ensure that we preserve paradise for future generations of residents and tourists alike. Just as we are protecting our flora and fauna, we are making moves to improve the infrastructure to make our visitors’ stays more comfortable and accommodating.

Over on Cayman Brac, enhancement of the Charles Kirkconnell International Airport will include expansion to accommodate security and screening equipment for the processing of international flights. The first phase of the enhancement will be an area for hold baggage screening, which will consist of such equipment as an X-ray machine for checked luggage. This improvement will allow for the processing of international flights in Cayman Brac, which will provide an important economic stimulus for Cayman Brac. Further phases of enhancement will include an expanded departure lounge facility and an enlarged arrivals facility.

Madam Speaker, the redevelopment of the Owen Roberts International Airport is proceeding in line with the procurement process set by the Foreign and Commonwealth Office. The Strategic Outline Case for the redeveloped airports facilities across the three islands will be considered by Cabinet this month. This document will form the basis for a Request for Proposals for an Outline Business Case to be produced, similar to the cruise berthing facility. Following this process, tenders will be invited for the construction of the first phase which is envisioned to be an expanded departure lounge facility.

The Strategic Outline Case mentioned earlier will also examine the way forward for a Cayman Islands Airports Authority owned and certified airport in Little Cayman. This airport will be built to international standards and will allow for more cost effective turbo prop aircraft to service Little Cayman. The airport is to be constructed on Cayman Islands Airports Authority property, with the runway being the first phase. Keeping our attention on the Sister Islands, the Hurricane Shelter site on the Bluff is to be converted to a High School to replace the present Layman Scott Senior School site. This project will be undertaken in phases, with the initial concept drawings being currently discussed by Ministry of Education, Ministry of District Administration, and the Public Works Department.

Madam Speaker, we desperately need berthing for big cruise ships that, as of now, are passing us by on a daily basis. The procurement process for the cruise berthing facility remains on track. The Outline Business Case is to be considered by Cabinet this month. Once approved by Cabinet, the Outline Business Case will be released to the public. After public consultation, the Request for Proposals for an Environmental Impact Assessment is to be developed and disseminated.

The Royal Watler Cruise Terminal has recently been enhanced with new tents and benches to improve the cruise visitor experience. Further organizational improvements are to be made in the immediate term in order to prepare for a significant increase in cruise visitors in 2014.

The current version of the Port Authority Law is the 1999 Revision, which is some 14 plus years ago. There are various provisions in the law that are to be reviewed and considered for an update.

Madam Speaker, another ongoing project is the George Town Landfill. The Ministry will embark on the RFP process, in accordance with the requirements of the FFR, with the goal of a comprehensive sustainable, integrated waste management solution for the Cayman Islands. It is anticipated that due to the significant capital investment that would be required to properly address this issue the Business Case will recommend a Public-Private-Partnership for the delivery of the solution.

This RFP will include all three Islands, and it is expected that it will result in recommendations to achieve waste reduction, enhance recycling, and determine the feasibility of waste-to-energy as a component of the waste management system.

Madam Speaker, there were two reports issued by the Office of the Auditor General in July and August 2011 that have been critical of the management of procurement. In addition, the new Constitution set up the Commission for Standards in Public Life, which is mandated to review and establish procedures for the awarding of all public contracts. A Working Group was established and a new legislative framework for procurement was recently agreed by Cabinet.

A new Procurement Bill will be brought to the House shortly and Government will establish a three person Central Procurement Office in the Ministry of Finance to be headed by a suitably qualified and experienced Director of Procurement.

The Central Procurement Office will be responsible for establishing procurement policies and procedures, developing and maintaining standard government procurement documentation, procurement oversight, carrying out some centralized procurement, advising government entities on procurement and training of employees involved in procurement. The Office will also undertake contract and post implementation reviews. The Director of Procurement will also be a member of a new Public Procurement Committee which will replace the Central Tenders Committee.

In addition, the “competitive dialogue” form of procurement to provide appropriate procurement options for complex procurements will form part of the new regulations. There will be an amendment to the regulations to clarify roles and strengthen oversight for procurement that takes place in the $50 – $250,000 range.

There will be a mandatory requirement for business case production in a standard format prior to a project being implemented for all projects over $250,000. The existing Public Sector Investment Committee will be reactivated and the membership appointed by the Minister of Finance. Policies and procedures will also be developed to ensure that adequate project management is in place for all significant projects.

Madam Speaker, there has been an increasing interest from international health researchers to come to the Cayman Islands to conduct health research and clinical trials. High costs and an onerous regulatory pathway have driven many clinical trials and innovative medical therapies outside the US.

Due to our proximity to the US, our stable political climate, our reputation for public safety, and our attraction as a destination, companies are looking to the Cayman Islands as a possible location for their research and clinical trials. The Health Practice Commission has already received applications from a number of groups looking to conduct their research and trials here.

There is an opportunity for the Cayman Islands to facilitate the development of centres of excellence in health research and clinical trials, but this must be done under a suitably robust and efficient regulatory regime in order to ensure that risks are not outweighing benefits, and our international reputation as a medical tourism destination is protected and enhanced.

To this end, the Ministry of Health and the Health Practice Commission will be forming a taskforce to make recommendations on appropriate policies and procedures to facilitate the development of this emerging area while ensuring appropriate research standards and patient safety are being adhered to.

While we are luring private sector investment, we are also aware that we have to nurture the small businesses already here.The Progressives made very clear in our manifesto our desire to help small businesses and to pursue the benefits of e-Government by providing transactional services and informational services on line. The Progressives Manifesto stated the following: “Streamline the bureaucratic requirements that currently hamper the setting up of new businesses” and “Encourage and enforce the use of technology for service improvements, better efficiency and improved cost effectiveness of the Civil Service”.

The Cayman Islands has a high saturation of computer users (74 per cent) Internet users (65 per cent) and cell phone owners (98.5 per cent). It is planned that the Government will use technology to a greater extent to enhance its service delivery to the business community and cut “Red Tape”. The percentage of Internet enabled mobile phones is not known; however, mobile devices are on the increase and need to be taken into account when developing the strategy.

In conjunction with the private sector, a review of government transactions will be undertaken of government departments with a view to maximising the use of information technology to provide better services to the public. The purpose of the review is to create greater efficiencies in government and increase responsiveness through the establishment of procedures that eliminate inconsistency and bureaucracy and develop systems that do not impede innovation; create unnecessary barriers to trade, investment and economic efficiency.

The liberalisation of Information and Communications Technology (ICT) networks and services, the promotion of competition in the provision of such networks and services and the development of e-Business continue to be a top priority for the Government.

It is anticipated that further competition in the Internet provision and Broadcasting (television) markets will develop within this fiscal year. As a result, consumers can look forward to greater choice (including more local content) and more competitive prices in terms of their Internet and television service. The ICT Authority will continue to develop the regulatory environment for telecommunications, sound and television broadcasting, all forms of radio operations including amateur radio, and the .ky Internet domain.

This year will see the continued rollout of fibre (fibre optic cable) across Grand Cayman, allowing more people across Grand Cayman access to faster Internet speeds.

The Authority has recently assigned spectrum to both mobile providers who will introduce the latest high speed mobile broadband technology available today, known as LTE (Long Term Evolution). The introduction of this new service will keep Cayman on par, with regard to mobile technology, with such countries as the US, Canada, UK, etc. and is expected to be available by the end of January 2014.

In addition, the Authority aims to build on its current consumer protection measures looking to ensure that consumers are properly protected from unfair commercial practices, including such things as raising consumer awareness on pricing issues, addressing misleading advertising and providing for appropriate switching processes for when a consumer changes their telephone or broadcasting provider.

Two existing Licensees (Logic and LIME) have recently entered the Broadcasting market and another is preparing (Infinity). Also, each is (or will shortly be in the case of Infinity) building out their respective fibre optic networks which will provide customers with much greater Internet speeds. The incumbent Broadcasting Licensee, WestStar, is also continuing to build out its fibre optic network across Grand Cayman. All will be able to provide enhanced TV services as well as high speed internet services. As a result, customers can look forward to greater choice (including more local content as each Broadcast provider is obliged to provide a stated amount of local content) and more competitive prices in terms of their Internet and television service. The ICT Authority will continue to develop the regulatory environment for telecommunications, sound and television broadcasting, all forms of radio operations including amateur radio, and the .ky Internet domain.

Conclusion

Madam Speaker, as you would have observed we have not been idle in the 4 months since we took office. Much has been done but there is much more to do.

This budget, which the Minister of Finance is about to present, will underpin these plans and provide the confidence and the environment and the oxygen to stoke the economic fires of these Islands.

Many hands and hearts and heads have contributed to the preparation of this budget and I wish to take this opportunity to express my profound gratitude to those who have burned many hours of midnight oil to bring this most important document to completion. I also wish to express my thanks to the many civil servants who are charged with implementing our many policies, programmes and projects.

In Paul’s first letter to Timothy he tells Timothy to “guard what has been entrusted to you”.

In May this year the people of this country entrusted the Progressives to form a government to get this country back on course. As Leader I have striven from the very outset to honour that trust by forming as inclusive a government as possible. I am grateful to you, Madam Speaker, who despite having been the previous Premier in another administration, was prepared to join the Progressives and serve as Speaker. I am grateful too, to the 3 Independent Members of the C4C who have joined the government and have brought new perspective and abilities to the government team. I am no less thankful to the members of the Progressive team for their wisdom and commitment to providing Cayman with the best government possible.

The result is an administration of immense depth and ability and which I am most honoured to lead.

Since we took office we have kept and are still keeping the faith and serving the people of the Cayman Islands honestly and earnestly. I thank God for his grace and mercies and with His continued guidance, we continue to work towards a better tomorrow, keeping the country on course through vision, teamwork and perseverance.

Oct 07, 2013

2013/2014 Budget Address

Madam Speaker, it is with considerable optimism that I present the first Budget of the newly elected Government, and my first as Minister of Finance a...

Oct 07, 2013

2013/2014 Budget Address

Madam Speaker, it is with considerable optimism that I present the first Budget of the newly elected Government, and my first as Minister of Finance and Economic Development. Although these are trying times, I am optimistic for the people of the Cayman Islands. A people who have experienced the impact of a weak economy for far too long; a people who have suffered with unemployment, rising cost of living, and rising crime; a people who almost lost confidence in the very institution of government and its purpose.

But, we are not a people who succumb to circumstance; we are resilient, we persevere, and always strive to rise above our challenges. And, Madam Speaker, our ability to transform the challenges of today, into opportunities for tomorrow, will be largely dependent on a fiscally prudent government.

This budget and the amounts set out in the Appropriation (July 2013 to June 2014) Bill, 2013 allocates resources to meet these challenges; and is aimed at getting the economic fundamentals right, with accountability, transparency, and prudence being the new modus operandi throughout all of government.

As we seek to grow our country’s economy, we acknowledge the constraints in our expenditure plans, while wholeheartedly embracing the need to be fiscally prudent. As such, I have entitled my Budget Address, “Economic Growth through Fiscal Prudence.”

It is important to understand the context of my theme. A government’s fiscal policy during difficult times is considered prudent when it is geared toward enhancing revenue mainly through economic growth, while targeting reductions in expenditures to lower the overall fiscal deficit, reign in public debt, and avoid increasing interest payments.

The public sector, therefore, should not accumulate debt at a faster rate than the growth of the domestic economy. Prudent fiscal management also involves generating operating surpluses to support capital expenditures, and accumulating cash reserves to lessen the effects of an economic slowdown. Madam Speaker, it is upon this foundation of fiscal prudence that this Budget is built.

If we learn anything from history, perhaps we should heed the famous Roman statesman, Marcus Cicero, whose timely wisdom came 55 years before the birth of Christ. I quote:

“The budget should be balanced, the treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance.”

Cicero’s words ring true today as it did in his time. His influence eventually led Rome towards a balanced budget, reduced public debt and lowered unemployment. Rome then went on to have almost 400 years of prosperity. The lesson I am trying to convey is that our hard times will end and we should strive for an end that is sooner, rather than later.

Madam Speaker, the fiscal policy of the Cayman Islands Government over the medium-term adheres to the definition of fiscal prudence. Revenues and expenditures are planned in such a manner that instead of increasing public sector debt, such debt will be declining. Our fiscal policy targets a modest revenue increase that is non-inflationary, and at a rate that is below projected economic growth, so as not to stifle our fragile economic recovery. This will be accompanied by a decline in total government spending without compromising necessary social investments.

Consequently, total debt of the Cayman Islands Government as a percentage of GDP is forecast to decline from 25.6 % in Fiscal Year 2012/13 to 23.2 % in the current fiscal year, and further to 17.1 % by the end of Fiscal Year 2016/17.

Some may be questioning whether fiscal prudence can indeed lead to economic growth. Normally one associates fiscal prudence with contractionary policy measures. However, this is not always the case.

Fiscal prudence can lead to economic growth by reducing the private sector’s tax burden, leaving businesses with important capital to expand their operations and create additional jobs.

First, by stemming the growth of government expenditure, a prudent fiscal policy can minimize excessive demand in the economy and reduce inflationary pressures. In this way, households and private businesses alike can benefit from the low inflation, encouraging consumption and investments and ultimately, employment growth;

Second, the government’s debt-reduction plan over the medium-term is helpful to local investors that depend on the global financial market. It is a general principle that the private sector’s cost of borrowing from global financial markets will be lower, once the credit rating of the government of the jurisdiction they are operating in is high. Our debt-reduction plan ensures that the currently high credit rating that the Cayman Islands Government enjoys (Aa3) will remain. This is particularly crucial in these times of turbulent global financial markets which tend to increase the cost of borrowing dueto higher risk premiums; and

Finally, Madam Speaker, fiscal prudence can also lead to long-term economic growth provided social investments are prioritized in the spending program. It is generally accepted that long-term economic growth depends heavily on investments in the education sector and other necessary capital investments to maximize the productivity of the work force.

Therefore, a larger share of these items in the government’s budget, notwithstanding the budget’s overall reduction in the medium-term, will ensure a positive impact of our fiscal policy on long-term economic growth.

Though we are facing a number of sizeable challenges, this administration will not only reign in spending, but we will also become more rational in the way we approach public spending. Our current fiscal position implores us to make tough but thoughtful decisions. We must live within our means, and question every dollar the Government spends whether that is within a core government department or in one of our Statutory Authorities or Government Companies.

In the Progressives 2013 Manifesto, Members of the People’s Progressive Movement laid out a vision of a prosperous future for our Islands in recognition of the great potential we hold. Today, along with the independent MLA’s, our government remains committed to that vision. This Budget is the declaration of our intent to begin fulfilling the promises we made to the nation by putting us on a path to fiscal sustainability.

Together, we must carefully assess our strengths and weaknesses, and focus on the strategies thatwill help us achieve our goals. These strategies must include:

1. Restoring trust and confidence in the government, by working more efficiently, promoting transparency, and reducing the overall cost of operating government. In particular, emphasis will be placed on building partnerships within core government and with the Statutory Authorities and Government Owned Companies, so that each unit is not working in isolation; making key investments in our people and our future, by continuing to provide the best opportunities for education locally and overseas, including appropriate training and vocational initiatives;

2. Upholding fundamental human rights, as it relates to reducing crime and ensuring a fair and efficient judicial system for all; and

3. Encouraging and supporting appropriate investment which will put us on a path toeconomic stability.

Madam Speaker, given our present fiscal position, certain levels of services and initiatives have had to be decreased or delayed in order to fulfil our long/short-term commitments. And although we have rejected general across the board cuts that threaten our priorities in education, employment, and the provision of basic social services for the neediest persons in our society, nonetheless, we pride ourselves in practicing practical prudency, and we have ensured that the 2013/14 Budgetallocates the necessary resources to keep pace with the growing demands for healthcare, education and social services, while protecting our borders and exploring opportunities for business prosperity.

We also recognize that we cannot do this alone and will work together – our Cabinet and the other members of this honourable house - to make the necessary decisions and implement the systems and processes to make our plan work.

2012/2013 FISCAL POSITION

Madam Speaker, I would now like to review with you the Government’s unaudited fiscal performance for the previous fiscal year which ended on 30 June 2013.

The Entire Public Sector recorded a net Operating Surplus of $63.3 million. The Government’s Net Assets were $1.3 billion. The Cash Balance was $117.06 million and core government debt stood at $575.9 million.

These results formed the basis from which the analysis and work necessary for the preparation of the 2013/14 Budget would begin.

2013 - 2017 MEDIUM TERM FISCAL STRATEGY

Madam Speaker, earlier I demonstrated in very straightforward terms, how fiscal prudence leads to economic growth.

I will now demonstrate how the Government’s Budget for the 2013/14 financial year, is grounded in fiscal prudence.

Madam Speaker, the very essence of Government’s fiscal prudence in the preparation of the 2013/14 Budget can be clearly illustrated by reference to the “Medium Term Fiscal Strategy 2013-2017” which was finalised and sent to the Foreign & Commonwealth Office (the “FCO”) of the Government of the United Kingdom, on 15th August 2013. On 22 August 2013, Minister Simmonds, the FCO’s Minister for Africa, the Overseas Territories, Caribbean and International Energy, conveyed his agreement to the Medium Term Fiscal Strategy. Approval was granted without the need to travel to London to participate in a defence of the Strategy. This clearly illustrates that there is an improved relationship between the United Kingdom and the Cayman Islands Government.

The Medium Term Fiscal Strategy was developed in order to bring the financial operations of the Government in full compliance with the parameters set out in the Framework for Fiscal Responsibility (the “FFR”) under the sixth schedule of the Public Management and Finance (Amendment) Law, 2012.

The FFR sets out four guiding policy principles:

1. Effective medium-term planning, to ensure that the full impact of fiscal decisionsis understood;

2. Putting value for money considerations at the heart of the decision-makingprocess;

3. Effective management of risk; and

4. Delivering improved accountability in all public sector operations.

This Government is committed to using these sound principles to guide our policy development.

The FFR also specifies the financial targets with which the Cayman Islands Government is expected to achieve full compliance by the end of the 2015/16 financial year. These targets are:

1. Net Debt of the entire public sector should be no greater than 80% of Operating Revenues;

2. Debt Service – that is, the annual payments related to all public sector borrowing commitments should be no greater than 10% of core government’s operating revenues; and

3. Liquid Assets, or the cash balances at the lowest point during the year should be no less than 25% of annual operating expenditures.

Madam Speaker, these targets are extremely aggressive but if we manage the country’s finances in such a way that we are able to achieve compliance with them we will ensure that the Cayman Islands will have the resources to continue progressing its development without unnecessarily burdening future generations.

The Medium Term Fiscal Plan gives us a path to FFR compliance and formed the frame within which the 2013/14 Budget would be prepared. I am happy to report that we have met these targets and have a budget which puts us firmly on the path towards FFR compliance and fiscal sustainability.

Under the agreed Medium Term Fiscal Strategy, Operating Expenses are forecast to decline by 2% annually from now until 2014/15, and then ease to a 1% increase through 2016/17.

Operating revenue is forecast to increase moderately at an annual growth rate of 2% between 2013/14 to 2015/16, and then 4% growth in 2016/17. This rate of growth is in line with the GDP forecasts which show a 2.3% growth in 2013/14; 2.5% growth in 2014/15 and 2.3% in 2015/16.

Madam Speaker, a country’s revenue burden is said to be declining if the growth of revenue collection is slower than economic growth, such that the ratio of revenue to GDP falls over time. This ratio for the Cayman Islands will be declining from 23.9 % in Fiscal Year 2012/13 to 22.4 % in Fiscal Year 2016/17. This clearly demonstrates our commitment to reducing the tax burden which is expected to positively impact the economy by making more resources available for private sector investment and employment opportunities.

Revenue generation in Cayman is directly linked to our general economic performance and our fiscal strategy does not seek to make any structural changes to this model by introducing any new or increased tax burden on the society.

Instead, we are focusing our efforts on revenue management by:

1. encouraging economic growth through private sector investment - as the economy grows so does Government revenue; and

2. improving the collection of revenues from existing measures by identifying and closing loopholes; and implementing clear policies limiting the grant of waivers and concessions from various Government fees such as import duty and stamp duties. These policies are currently being finalised and will be published before the end of October.

Over the medium term, Cayman’s economy will benefit from large scale projects from both the public and private sector, such as: the redevelopment of the Owen Roberts International Airport Terminal; the construction of a modern cruise ship berthing facility; the development of the new Kimpton Hotel on Seven Mile Beach; redevelopment of the former Hyatt Beach Suites Hotel; the development of a new hotel near the Cayman Health City Hospital; and the development of a new hotel in Beach Bay, Bodden Town.

These capital projects when combined with the expected strong growth in the financial services sector and strong tourism arrivals point to a very robust economic outlook.

Consequently, the Medium Term Fiscal Plan calls for no new borrowings by the Government over the forecast period, instead the Government will be focused on paying down its debt and where possible restructuring its debt portfolio to cut interest costs and remove potential uncertainties around the repayment of bullet bonds.

Madam Speaker, I will now turn to some of the economic forecasts underpinning the Medium Term Fiscal Plan. In Fiscal Year 2013/14, barring any major spikes in international oil prices, inflation is estimated at 1.6 %. Inflation is expected to increase marginally to 2.3% in Fiscal Year 2014/15 and to 2.5% in Fiscal Year 2015/16 as gradual economic recovery in the rest of the world exerts upward pressure on food and fuel prices.

Madam Speaker, economic growth in the past fiscal year also had a positive impact on labour supply and employment. The total labour force expanded, with employment growing by 2.5%. The improvement was particularly strong in 2012, in a number of sectors such as: hotels and restaurants; construction; manufacturing; mining and quarrying; and administrative and support services.

However, the unemployment rate remained at 6.1 % in the 2012/13 Fiscal Year as not all new entrants to the labour force found employment.

In the 2013/14 Fiscal Year, the unemployment rate is projected to decline to 5.9 %. In the succeeding years, the unemployment rate is expected to be lower than 5.9 % as the envisioned projects and other local services with strong linkages to these projects generate greater employment opportunities.

Sustained improvement of the tourism and financial services sectors is also expected to absorb new entrants to the labour force.

2013/2014 FISCAL OUTLOOK

Turning now to the details of the 2013/2014 Budget. Operating Revenues are forecast to be $644.6 million; Operating Expenditures are forecast to be $517.9 million; and Financing Expenses are forecast at $31.4 million. This results in a core government net operating surplus of $95.3 million. After factoring in the forecast net operating surplus of the Statutory Authorities and Government Owned Companies of $5.0 million the Entire Public Sector is forecast to record a net surplus of $100.3 million.

Capital Investments are forecast to be $51.9 million.

Core Government debt is forecast to be $548.8 million at 30 June 2014 based on no new long term borrowings and principal debt repayments of $26.3 million during 2013/14.

Cash Balances are forecast to increase during the year by $44.9 million growing to $161.9 million at 30 June 2014. Of this amount $59.9 million will be in the operating bank account and $102 million in the various reserve funds such as the General Reserve Fund, the Environmental Protection Fund, the Infrastructure Development Fund, etc.

However, even though we find ourselves in a surplus position, with today’s fiscal challenges comes the opportunity for Government to demonstrate greater wisdom in spending the people’s money. This Government is committed to doing just that and together with the civil service we will strive to deliver solid financial performance during our tenure.

The Government’s revenue outlook is stable, and is not dependent on any unproven measures. This year will see the implementation of only one new tax measure, ‘Licensing and Registration of Hedge Funds Directors.’ This measure was originally announced last year by the previous administration but was delayed in order to allow for proper consultation with the financial industry.

When examining and agreeing the operating expenditure limits set out in this budget the government was challenged to balance the needs and demands of the society with resource limitations. As you are aware Madam Speaker, the demands on Government’s expenditures are driven by a number of factors, this year, the primary drivers of expenditure are:

1. Necessary education and training initiatives;

2. Unemployment related issues;

3. Rising Health Care costs;

4. Rising Crime rates;

5. continued reliance on Government’s social assistance programs; and

6. New constitutional requirements.

With every household and business in Cayman being forced to scrutinise their expenditures, as a responsible government, we too, have looked at our operating expenditures, to ensure that our citizens are getting the best value for their tax dollars.

The operating expenditures of the Government are impacted not only by the operations of the core government (Ministries and Portfolios) but also by the operations of the various Statutory Authorities and Government Owned Companies (the “SAGCs”).

These SAGCs are an integral part of the Cayman Islands Government because they exist through delegated authority to carry out certain functions and to minimize liability risks. But as a result of their existence they are in a position to have first call on the revenue they collect. Therefore any effort to improve the financial performance of the Cayman Islands Government must include the SAGCs.

Last financial year the Government spent approximately $110.8 million on outputs from the SAGCs.

For 2013/14 this has been reduced to $100.7 million by implementing a number of innovativemeasures.

On 14th August the Ministry of Finance held a meeting with the larger SAGCs to discuss matters related to annual budgets, how to achieve greater collaboration between SAGCs and improving financial performance. During that meeting it was discovered that while some SAGCs collect most of their revenue in US$ but expenditure is in CI$ there were others that collected the bulk of their revenue in CI$ but purchased large quantities of US$ from the local banks for their overseas expenditure. Consequently, it was agreed that they would collaborate whereby those with excess US$ cash would sell to those in need at a fair exchange rate.

Madam Speaker, I am pleased to say that thus far this arrangement could potentially save one entity US$350k in foreign exchange costs and enable another to receive an additional US$100k in foreign exchange revenue; a combined benefit of US$450k during this fiscal year. Madam Speaker, today I am speaking of hundreds of thousands of dollars between two entities during this 2013/14 Fiscal Year, but, across all SAGCs, this will amount to millions of dollars within a few years. As is often the case a dollar saved is a dollar earned.

Madam Speaker, coming out of that August 14th meeting, it was also agreed that the Cayman Islands Airports Authority (CIAA)would no longer charge rent to the Customs Department and the Immigration Department. Instead the CIAA would receive revenue directly from other coercive fees diverted from core government.

The net effect of this decision is zero but the overall benefit is that it allows core government to reduce its operational expenditure and avoid the need for increased tax revenue, thus reducing the pressure to add to the cost of living and doing business.

Along the same lines the, Government will take a policy decision to exempt core government agencies and SAGCs from paying import duty. While this measure means that the Government will appear to earn less revenue it also means lower operating expenditures for both the SAGCs and core government.

Another area of partnership between the SAGCs and the core government is in the area of cash management. Based on their business cycles and the underlying cash flows there are times when SAGCs have surplus cash on hand lying idle while the core government is running an overdraft. By partnering with the SAGCs to have them place their surplus cash on deposit with the Treasury Department, the Government is forecast to save approximately $89,000 in interest expense by 31January 2014.

Madam Speaker, the four initiatives launched with our SAGCs that I just spoke of: collaboration on foreign exchange transactions; the removal of rental charges on core government departments by SAGCs; the removal of customs import duty; and improved cash management - all lead to a reduction of operating cost for the Cayman Islands Government. And by reducing operating cost, we will in effect reduce the need for new and inflationary revenue measures over time.

A number of other measures have been initiated within the public sector to determine where expenditure can be further reduced, these initiatives include:

 The continuation of the Budget Delivery Committee;

 Rent savings: where possible various agencies are moving into vacant spaces in the newGovernment Administration Building in lieu of private rental accommodations;

I would like to re-emphasize that major cuts to essential programs and services were not considered. Depriving our society of fundamental support will likely cost these Islands much more in the future in terms of economic development and social issues. Nonetheless the 2013/14 Budget incorporates necessary, targeted and sensible reductions to Government expenditure.

Madam Speaker, the 2013/14 forecast for core government Operating Expenses of $517.9 million represents a $6.8 million reduction from the 2012/13 levels. The major components of the operating expenses reflected in the Appropriation Bill now before this Honourable House are:

 Personnel Costs - forecast to be $237.6 million, this includes a provision of $11.4 million tobe paid into the Public Service Pensions Fund towards the Government’s past service liabilityfor civil service pensions benefits;

 Supplies and Consumables are forecast to be $90.9 million. This represents an increase of$3.4 million over 2012/13 but is driven primarily by having to account for a full year ofoperating costs of the new Clifton Hunter High School and additional classrooms at primaryschools as well as costs associated with the upgrade to the Government’s financialmanagement information system (IRIS);

 Outputs from Statutory Authorities and Government Companies are forecast to be$100.7 million this is a reduction of $10.1 million from 2012/13 and is primarily the result ofthe initiatives I spoke of earlier along with the reassignment of $5.5 million in coerciverevenues to the Cayman Islands Monetary Authority and $4.5 million to the Health ServicesAuthority which has allowed the Government to reduce its output funding to these Authoritiesby the same amount;

 Outputs from Non-Governmental Output Suppliers are forecast to be $25.2 million. Theappropriations within this category of expense fund a wide variety of programmes provided byagencies external to the Government. The major items in this category are: $14 million tofund overseas medical care for indigents and uninsured persons; $2.5 million to provide LegalAid services to qualified persons; $1.6 million to provide rental housing accommodations topersons in need; $1.5 million in funding to the Cayman Islands Private Schools Association;and $1.4 million to fund the NCVO Pines Retirement Home to provide residential care toindigent, elderly and disabled persons.

 Transfer Payments are forecast to be $33.2 million. While this is a $1.5 million increaseover the 2012/13 Budget, the appropriations within this category provide funding for manyimportant programmes including: $13.6 million for local and overseas scholarships; $7.8million for poor relief payments to the most vulnerable persons in our community; and $6.7million in benefit payments to our most needy seamen and veterans.

The planned capital investments of $51.9 million is intended to fund some $27.3 million in coregovernment assets such as roads, land, building improvements, vehicles and equipment. A sum of$24.6 million will be invested in SAGCs primarily to fund the debt service obligations of these entities.In terms of compliance with the Principles of Responsible Financial Management set out in the PublicManagement and Finance Law and the Framework For Fiscal Responsibility the 2013/14 Budgetforecasts the following levels of compliance with the principles:

1. Net Operating Position: Should be Positive: – for 2013/14 this has been achieved with a$100.3 million operating surplus forecast;

2. Net Worth: Should be positive: for 2013/14 Net Worth is forecast at $1.36 billion;

3. Debt Service: Should be no more than 10% of core Government Revenue: – For2013/14 this is forecast to be 12.2%;

4. Net Debt: Should be no more than 80% of Core Government Revenue:– for 2013/14Net Debt is forecast to be 72.4%;

5. Cash Reserves: Should be no less than 90 days of estimated executive expenses:

For 2013/14 this is forecast to be 6.5 days. While this may seem low to some it is importantto point out that as per the FFR, this ratio is calculated at the point in the year when the coregovernment’s cash balances are at their lowest. Based on the forecast profile of cash inflowsand outflows this is expected to occur at 31 December 2013 when the unrestricted cashbalances are expected to be $9.8 million. Therefore, taking the cash balances at 31 Decemberallows for a more robust measure of cash reserves.

Having said this, I am making it clear that although our fiscal resources are limited, we are making investments where possible, while maintaining effective levels of support for our people.

CONCLUSION

In closing, I would like to re-state my optimism for our country and by working together we can achieve a prosperous future.

While there remains a lot to be done over the next four years, we have taken the initial steps of identifying our vision of what we wish to accomplish and establishing the resource framework within which to operate. With the right attitude, we can convert our challenges into opportunities.

Madam Speaker, we cannot allow our people to fall behind. As legislators, we all have a responsibility to act prudently and make decisions which address the needs and concerns today while setting a firm foundation for the future.

This Budget affords us the opportunity to reshape Government. We are changing how we do business; we can no longer proceed with “business as usual.” We must learn to do more with less.

During the campaign trail, we made many promises, which we intend to keep. However, with our fiscal constraints, we have to make prudent choices. We have to prioritize some projects while deferring others. We have to adjust to our current realities.

However, with this Budget, this Government has taken a major step forward to a brighter future for these islands - one in which the country will have the financial resources to weather future economic storms should they arise and a future that is filled with endless opportunities for personal growth, economic growth and the well-being for our people.

The people of the Cayman Islands have a long and proud history of being creative, resilient, industrious, caring and hardworking and we must now seek to draw on these values and characteristics which have served us well through the ages to now move the country forward in a new age.

Madam Speaker, this Budget is responsible; balanced; facilitates economic growth and clearly sets the country on a fiscally responsible path.

Finally, the preparation of the Government’s Budget is an enormous undertaking and this year would not have been possible without the hard work and commitment of many and I wish to thank the Honourable Premier; Cabinet Ministers; Official Members; Councillors; Chief Officers and their staff.

Also, I especially wish to thank the Financial Secretary, Mr. Kenneth Jefferson and the team within the Ministry of Finance, including Chief Officer Mrs. Sonia McLaughlin; Senior Assistant Financial Secretary Mr. Michael Nixon; Deputy Accountant General Mr. Ronnie Dunn and the staff of the Budget and Management Unit.

It has been both an honour and a privilege to present this Budget today. I now humbly commend the Appropriation (July 2013 to June 2014) Bill, 2013 to this Honourable House and ask all Members for their support of the Bill.